Last night I chanced upon an article authored by Vivek Wadhwa in the Wall Street Journal. In this article, Vivek has succinctly written about why entrepreneurs should focus on building a lifestyle business and not only aim for an exit. This made me reflect on my personal story. The timing couldn’t be better as I near the end of my 3rd year run of my 3rd round of entrepreneurship.
With hands-on experience in both, running a firm with Venture Capital (VC) money and bootstrapping, I well know what it means to battle for VC money (during my 1st round of entrepreneurship) and then ensuring returns for them. However, when I was founding Greyhound Knowledge Group in 2013, I was certain of not roping in VC money – at least not in the short-term. Whilst there are more than a handful – well-wishers, friends, family and others – who have disagreed with my strategy of bootstrapping, my reasons remain deeply engrained in my ideology.
An avenue where I can truly support my passion and yet make a good living.
Back in time, I chanced upon the IT analyst world only to find out my true love for this line of work. While I was fortunate to be in the company of some great colleagues and clients, there were gaps in existing business models and operations that urged me to approach the analyst business differently.
Greyhound offers me an avenue to approach this business with true passion, and ethics. It allows me the flexibility to work with only those clients who appreciate a truly independent research & advisory outfit. Yes, truly independent. 🙂
Keeping afloat on client money – real revenue and profitability.
I have vivid memories of the day we won our first client, got the first cheque and hired our first employee. Lots of firsts here that every entrepreneur enjoys. Not to say that those running a VC funded firm do not have similar memories, but then for those bootstrapping their way, this is another high. Allow me to explain.
I started the business with US$ 100 and had to wait out for weeks – sometimes months – before I could experience some of these firsts. And when you toil as much and wait as long, the sweet pleasure of experiencing those firsts cannot be merely described in words. It’s truly built on sweat, tears and blood. A very different experience from the firsts on the back of VC money.
Focus on core expertise and not fall for short-term gains.
Leaving money on the table is not easy for any company – be it a VC funded firm or a bootstrapped one. But then again, only those running a latter experience the next level of pain – the same money that could have helped them hire another and much-needed employee, get an office, replace an old laptop or worse still, pay debts back to lenders.
In the past three years of running the show at Greyhound Knowledge Group, I’ve experienced this up and close. Each time a friend from a technology vendor calls to enquire about co-branded whitepapers or sponsored events (where we will be tasked to call CIOs and IT Decision Makers), I remind myself why I set out on this journey and get back to what we do best – write independent research.
Willing to unlearn and relearn.
I have often heard my peers – other Founders & CEOs – talk on how they plan to use best practices from their previous avatars at their own outfit. I don’t subscribe to this philosophy. Running your own enterprise requires you to use your previous avatars to find an opportunity, a market gap – but planning to ape learnings won’t give you a head-start. IMHO while it’s important to know your competition and ecosystem, it’s critical for you to not ape them. This is all the more critical when you are running a bootstrapped firm with limited or no funds.
Bootstrapping my way has forced me to unlearn a lot what I considered best-in-class from back in time and relearn leaner ways to achieve the same. Over the past three years, I have trained myself to become a coder, a web developer, a social selling enthusiast, a finance rookie and a lot more that my previous roles didn’t prepare me for. Unlike VC funded firms where burning cash and failing is seen as a healthy sign, bootstrapped firms enjoy nothing remotely close. In fact, our journey is much the opposite in many ways.
Putting the focus where it matters – Innovation and Profit Centres.
Not being dependent on VCs means not having to give in to the pressure of churning numbers and hence room for innovation for an extended period. But then entrepreneurs run a sizeable risk of lacking the much-needed rigour on ensuring the enterprise is doing what it should – bring home the dollars, grow healthy year-on-year and report profits.
It’s taken me many-a-failed-quarters before I faced the harsh truth. Only recently we realised there was much fat in the system – it was making us sluggish and we were losing critical time to market and hence money. That is when we turned a leaf, or two. We cut out most overheads and only those employees were retained that could directly act as profit centres. This, I believe, has put us back on the growth trajectory.
Love it enough to keep full control and autonomy.
I am often asked if I would like to sell part or complete stake of Greyhound companies. Some even go to the extent of asking what do Greyhound companies mean to me and why wouldn’t I sell all stakes to join them and head a region/ business unit.
This question plays out a ton of emotions in my heart – it’s much like being asked would you sell your children for money! Yes, it’s that emotional for me. And then, there are other mature heads who respect your spirit of not giving up on control despite you putting down their offer for a few million dollars offered on your company’s first anniversary. Yes, that happened to us! 🙂 With two offers of acquisition and investment interest behind us, we are extremely happy being where we are. More importantly, I’m real about expectations from this business – it will not offer me 10x or even turn me into an overnight millionaire. But it’s surely allowing me to hone my mental faculties, enrich myself with the latest knowledge, give back to the economy by offering direct and indirect employment and most importantly, contribute rich and meaningful insights to this ever-changing industry.
In short, running Greyhound Knowledge Group for past 3 years has been a life-changing experience for me. An experience that has taught me the importance of appreciating minimum availability of resources and yet managing outcomes, facing failure and unlearning old methods, having the patience to wait it out and being honest to self on expectations and returns.
Here’s to the spirit of entrepreneurship and bootstrapping!