Sexing your startup won’t generate money; attending conferences, wining awards and having 200,000 twitter followers is not an indicator of success. I realised it lot earlier that my dad’s small hardware shop in my hometown doesn’t fall into category of startups, hasn’t raised money but still generate 100 times more revenue than most startups do, has 70% repeat customers and have zero followers in facebook. Well, my dad doesn’t know facebook except it is a place where my sister litters all her time playing candy crush. [Well, she comes for help to clear levels, sometimes]. It has probably a higher survival rate cause my dad has focused on sales rather than presenting in front of bored audience in startup capitals.
Well, this is personal insight biased on the events from my life as I keeping searching for stepping stones and landing on stumbling blocks. So, don’t get angry. startup founders aren’t really cash rich nor their valuation is fake. Well, sounds contradicting right?
There is startup fever here in India. Before, I landed in 91Springboard Delhi for couple of months, I was just a guy working his butts off and I didn’t had time to talk with investors cause I had to talk continuously with my clients even in my daydreams. So, startup was a fishy segment to me. But it was quite lucrative though. Millions and Billions; haha. I am fortunate enough to own about like 5 million till date but I can explain each of the 100$. But startups are like billions; well that’s gross.
Million Dollar Tag
Startup A raised 20 mn from Venture B and valued at 2bn.
This is one of the many blaring headlines that you might have seen over the past few months – of Indian startups raising mega-bucks at mind-boggling valuations. To the casual observer, it might seem that India is now in a golden age where raising funding is child’s play and achieving stratospheric valuations is de rigueur.
However the truth is far from this… The Truth is Startup founders typically make little or no salary, put their own money into the company, and their shares aren’t worth anything for a while.
The Saturday Pitch
It was a saturday and I was watching Ghost movie in the middle of the night in 91Springboard with couple of other co-workers. Well, there were folks who used to work, eat, sleep and work again all the time. So they are always around. Someone gmailed me to play Foosball so I met a new guy. He proposed me to invest in his million dollar company. The term million-dollar is pretty important considering the guy himself earns barely 200-300$. But it must be million and it must be dollar, lol.
Why I must invest?
So, the valuation is never fake if they’re honest and have sensible investors, but valuation is a term of art and does not translate directly into spendable cash. I played foosball and explained him I am really a beggar considering the half pants I was wearing for a week. And directed him to some other genuine players.
Where’s the developer ?
I posted two jobs. One is for WordPress developer, another is for Android developer. For WordPress, if someone knows how to convert a bootstrap HTML template properly to WordPress and have some mild knowledge of WordPress functions, that was more than enough for me. For Android, well, I learned it from Treehouse. I just needed someone who knows to make an app like Startup Quotes and know some other basics. So I bugged a nearby startup’s top android devotional developer. He said he has some gold level certification from some company but he said he doesn’t know how to make app like Startup Quotes.
But he told that he is planning to open an android app company in coming couple of months. And then he did the pitch, if I make his company website, I will get 5% stake.
Well in that moment, I was charging average of 2-3k$ per website and his salary was 250-300$ a month. Well, that’s a nice pitch. I love the culture of stealth wealth. I said yes but hmm.. I have no clue where is he now.
By the way, I interviewed 46 persons for WordPress and none of them have knowledge to write a plugin which can disable the nags and notifications of WordPress update. So, I was frustrated, tired and well, frustrated again..
There are too many founders; got madly inspired by movies like Jobs or The Social Network and having a visiting card with CEO tag but sadly with salary <150$ a month. I am still waiting for person who can talk less and code more along with me. In the very few cases where a company is wildly successful, then after a liquidity event like an acquisition or IPO the founders could get very rich in both cash and stock.
Before the liquidity event they may find some early liquidity or other ways — enough to lead a rich lifestyle, but not
exactly buy a private jet or something like Necker Island.
Most service companies I found in 91Springboard, Delhi (Well, its mini India as there is versatile amount of startups in one place) is branched out from big companies. Let say, I work in Infosys and I get to know some clients and I got repeat works from them. So I quit Infosys, label me as a startup and award myself as supreme tech company with dozens of awards and carry a CEO visiting card. Well, that’s silly. Company is many thing. Like for tech companies – design, develop, content, market – there must be 4 kind of skill needed to a terribly mind-blowing level to get the company fly. But who cares.
Well, there are too many founders founding things without being serious and hence, spoiling the entire spirit right on.
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