One Testimonial At A Time

In the recent past, there have been numerous reports on startups either shutting shop or sacking employees in the hundreds. If one was to look a little closely, the genesis of all these announcements is an idea backed by a poorly constructed business model and injected with large sums of investor money. Irrespective of whether the Founders accept their mistakes or not, the fact is, the ride on the back of free-flowing investor money is over and hiding behind meaningless numbers like Gross Merchandise Value (GMV) isn’t going to work anymore.

IMHO While startups did extremely well to use their Public Relations muscle to ensure that GMV becomes industry’s darling, it’s no more than a cover up for numbers that aren’t good enough to be reported and may well point to the lack of a sustainable business model. Pardon my honesty on this topic.

Over the past 6-9 months, I’ve given numerous statements and interviews in the media on the back of our research to reiterate the point on GMV not being a tangible number that can be reported. It’s about time startups share more tangible numbers like Revenue, Profits, Cash Flows, NPS among others. Other than being real, these numbers eloquently talk about the strengths (and weaknesses) of startups. I’ve also spoken (enough and more times) on the need for startups to seriously consider process orientation being core to scaling – an issue that almost always gets less attention than it deserves.

IMHO Being known for innovation is one thing and ensuring the same innovation leads to invoices over a sustained period of time is another.

Only recently I wrote about my reasons for taking the route of building a lifestyle business (read bootstrap) and not going down the path of taking Venture Capital money. Don’t get me wrong, I’m not suggesting one is better than the other, I’m just sharing the choice I made and my reasons for it. There are implications of being on either side and it’s ultimately a choice that we all entrepreneurs make.

IMHO When running a lifestyle business, focus is not on building to sell and exit but on nurturing to keep and grow.

Having said that, it saddens me sometimes how the industry tends to create fanboys out of those who have taken the VC route and enjoy fancy valuations (not real revenue). Little or no recognition is conferred on the breed of entrepreneurs who have taken the hard route of bootstrapping, are toiling hard day and night to build a brand that is churning real revenue and ultimately solving real-life client problems.

IMHO While it’s heartening that our ecosystem encourages entrepreneurship, it’s also worrying that it glorifies (and targets) a chosen few. The unsung heroes who have built, scaled and sustained without venture capital funding rarely make it to the headlines. 

For entrepreneurs taking the route of bootstrapping, it’s important to look through the market noise, focus on the reasons that helped them start out in the first place and keep paranoid. Critical for us folks to remember, this journey isn’t about quick overnight wins but long-term sustainable gains. Having said that, there’s one thing that we all must avoid – falling into the trap of getting overly busy with onboarding customers and forgetting to give them the attention to ensure they turn testimonials.

IMHO Ultimately, running a lifestyle business is not about one customer at a time, but one testimonial at a time.