Yes. We are a Small Company.
I have now spent exactly 30 months of my life working full-time on InsideIIM.com.
Over the last quarter of 2014, I have repeatedly been told in different ways that we aren’t playing the big game. The opportunity we seem to be chasing isn’t big enough. Essentially, what we are doing is ‘small’.
The background to this is that we have had discussion with many people recently on fund-raising. Also, we are actively recruiting for a few positions at InsideIIM.com. I also talk to a lot of people who seem to want to start a company of their own and are often worried that they don’t have an idea big enough to be the next ‘big’ thing.
I don’t intend to start a discussion on the size of the opportunity. I am not even going to argue that what we are doing is not ‘small’. I am also not going to challenge the wisdom of people far more experienced than me in investing in various companies.
In fact, my recent conversations have forced me to think – ‘What’s wrong in being a small company?’
What’s wrong in building a profitable company which will at best make a few hundred crores or just a few crores? Every new company cannot be Google or Uber. It should not be. Because if everyone built a company worth multi-billion dollars, 99% of the problems in this world will never be solved. We would live in a world where everything would be homogenous served to us from an assembly line of products and services. Imagine a world where your only burger option was a MNC giant’s standardized version because there were no cafes and small food joints who would make fresh custom made burgers with innovative recipes. No one would try anything different unless it was projected to make a billion dollars. There would be no craftsmanship or creativity. There will only be giant organizations controlling everything.
If India needs to solve its problems we need more people (especially our best talent) to become entrepreneurs. We need to churn out lakhs of them each year. There is no way the government or the current private sector can create 12 Million jobs a year without a large percentage of our population becoming entrepreneurs. I believe that current discourse may end up discouraging people on taking up entrepreneurship. We seem to have come to a stage where the perception is that unless you come up with a billion dollar idea it is not worth becoming an entrepreneur. I find it difficult to believe that anyone ever started a company knowing from day one that it will get a multi-billion dollar valuation. Also, if capital is only going to chase what a group of analysts believe is potentially a billion dollar idea, then we are in big trouble. A small entrepreneur is stuck. He/She can’t raise money from VCs because he/she is not perceived to be sexy enough to be the next Google. He can’t raise enough debt because the profile is risky. Profit-making small companies are asked to cough up 16-22% to raise debt. And that is after they qualify to get debt in the first place. I keep read stories of big companies sitting on billion dollar debt which they are in no position to pay back. A lot of them have managed to raise that kind of debt owing to connections or corruption in PSU banks. Now imagine if that money had gone in supporting a few thousand entrepreneurs instead. Even if 10% of those entrepreneurs succeeded we would have created so many more jobs and potentially a billion dollar company would have emerged out of that.
I think we also seem to view successful small businessmen as inferior in our society. The social status of a person slogging away behind a computer, number-crunching, for a foreign company seems to higher than that of a hard working but smart entrepreneur who sells Saris or makes ‘atta’ (flour). This is the case even if the entrepreneur is making 4 times the money the salaried number cruncher makes. In part it is tied to one of India’s greatest problems – Dignity of Labour.
I have seen some scary talent in some of the best institutions in India. And yet so few of them take the road to building something of their own. For some strange reason, they think it makes more sense earning a few ten lacs over giving themselves the opportunity to make the best use of their talent. And it is not as if the jobs that majority of them take up are solving a real problem either. It leads to massive dissatisfaction and you will keep hearing these guys complaining all the time.
It is extremely satisfying to build something of your own. If you have a little common sense then you can also make ‘enough’ money. And I say ‘enough’ because there is no limit to how much you may want. But, let’s say it can help you make at least double of what a well-paying job from campus can help you earn in say, 5 years’ time. Is it alluring? Actually, it doesn’t matter. I have rarely met an entrepreneur who started a company only to make money. But even if one did it is a perfectly rational decision because it can make economic sense. It is a myth that taking the entrepreneurial plunge is risky. Not in the time and age that we live in.
Above all, starting something of your own gives you what we all always crave for – Freedom. Freedom doesn’t mean lack of responsibility or hard work. It means that you can pursue things you truly believe in. It will also involve doing many things you do not like but you will always know that you are doing it in order to achieve something you want to. Creating something is satisfying and personally enriching. The positive impact that you make on the lives of your users, clients, employees and everyone associated with your creation is the biggest takeaway. Whether the impact is on 100 people or 1 Billion is not important.
In this regard, I always find talking to people from smaller cities and more disadvantaged backgrounds to be a very positive experience. The aspirational among them are always itching to do something and they don’t waste their time masturbating on scale and valuation. They just want to get down to do the actual thing of creating a business.
I want more people to take up entrepreneurship. And I want them to know that it is OK to be an entrepreneur creating a ‘small’ company that solves a real problem. There is also nothing wrong in joining the team of a supposedly ‘small’ company.
About 4 years back I first got to know that I was given a nickname by some of my batch mates – ‘CEO’ – not necessarily in a good way 🙂 Today I am CEO of a profitable company that I have built from scratch. Yes. We are a small company.
I hope 2015 is the year of the small entrepreneur. Let’s make being a small company ‘cool’.
The Author is the Creator of InsideIIM.com