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Above all other things, a vision is a tool for sustaining hope, confidence and commitment in the
face of uncertainty

Perhaps few people have anticipated a date as eagerly as the 778 people who gathered in
Kanungu, Uganda March 17, 2000.

They had been promised by their visionary leader that they would witness an extraordinary
event: the end of the world. As one follower explained it, ³Some of our leaders talk directly to
God. Any minute from now, when the end comes, every believer who will be at an as yet
undisclosed spot will be saved.´ Like-minded believers held a party to celebrate their
forthcoming rapture, roasting three bulls and consuming 70 crates of soft drinks. However, when
the end of the world did not arrive as expected, the denouement was tragic: the leaders of the
Movement for the Restoration of the Ten Commandments of God poisoned their followers and
set off an explosion that consumed the bodies.

I relate this grisly, heartbreaking bit of history to

illustrate a point: great entrepreneurs are often
considered powerful, visionary leaders²but so are some
raving lunatics. Having a clear and compelling vision
that you and your followers believe in absolutely doesn¶t
necessarily mean you¶ll realize your goal. Those of us
who write for and work with entrepreneurs often convey
the thought that they need to convert their
entrepreneurial dream into a convincing and vivid vision
that other can buy into. But just how important is it for
you to be a visionary entrepreneur, and how do you
know your vision is productive?

Having a vision is a means to a set of ends, not an end in

itself. Understanding those ends allows an entrepreneur
to distinguish between productive and unproductive
investments in communicating a potent vision to his or
her stakeholders. If you know what a vision is for and { 
  
what it does, you can craft an appropriate one and update it when necessary.

Above all other things, a vision is a tool for sustaining hope, confidence and commitment in the
face of uncertainty. Uncertainty can paralyze organizations. Uncertainty lends a certain spice and
excitement to life when we are uncertain about things like the outcome of a sporting match or the
ending of a movie. However, when people are faced with uncertainty about where they are going
or what is their purpose, they find it difficult to advance. If you believe you know where you are
headed, you can pursue a path with vigor, and even if it turns out to be the wrong route, you can
often make reasonable progress. If you spend your time searching for a direction, forward
movement stops.
Leaders replace fear, uncertainty and doubt with hope, confidence and trust. When they are
uncertain, people find it difficult to cooperate with one another. Leaders restore belief that the
people who follow them can rely on one another to pull in the same direction. Leaders do this by
articulating a clear picture of a better tomorrow that makes sense to the people who must
collaborate in order to reach that future.

A really good vision is like a movie in your head. It is a vivid picture of what it would be like to
live in a better tomorrow. You can see what happens, hear what people are saying, feel the
emotions associated with that better tomorrow. If you and others can vividly describe what that
tomorrow is like and why it will be great to live in it, you can say with confidence that you have
a shared vision. Whatever happens next, we need not fear uncertainty because we can describe
what it will be like when we realize our aspirations.

However, a clear vision is necessary but insufficient to hold an entrepreneurial venture on course
in the face of uncertainty. Entrepreneurs need to show with some frequency that they are making
progress toward a better tomorrow, even if the path into that future is not the same one we started
with. Visible progress reduces the uncertainty that is always associated with entrepreneurial
ventures. It creates the self-fulfilling conviction that the organization is moving forward.

The doomsday cult I described earlier had a clear vision, but the only way to show progress
toward it was to let time pass. Originally, its leaders predicted the end of the world would arrive
January 1, 2000. When that date passed, they moved their prediction forward by 78 days. But
they had no way to show that they were advancing, and when they ran out of ways to create the
illusion of progress, they chose a catastrophic alternative.

Similarly, George Bush believed he had a clear vision when he invaded Iraq: implanting a
Western-style democracy in the heart of the world¶s most volatile region. Unfortunately, he
didn¶t ask whether the people who had to cooperate in order to realize that vision bought into it.
More importantly, however, he never subjected his vision to a reality check. No amount of
evidence could persuade Bush and Donald Rumsfeld that Iraq was slipping away from stability.
Having convinced themselves that time would solve Iraq¶s problems, they had no objective way
to realize it was time to change course.

A powerful vision sustains confidence only if people can visibly see themselves progressing in
the right direction. As long as they believe in the goal and believe they are closing the gap
between what is and what must become, they¶ll tolerate course changes. But when a vision is
never subjected to a reality test, it is just a matter of time before it loses its power to uphold
belief in a venture¶s direction.

So a visionary entrepreneurial leader must create a shared ³movie in your head´ that creates
confidence and conveys purpose while staying anchored to reality. In addition, a meaningful
vision acts as a compass for an organization. It helps people figure out what choice to make
when it¶s not obvious which choice will produce the right outcome. A compass is not a road
map. It shows direction, rather than specifying the path forward. A vision that makes a difference
provides clear guidance that helps people make difficult decisions that hang together over time
and across organizational boundaries. If we all agree on what a better tomorrow will look like,
we can subject most choices to a test: will it move us toward that shared picture of what we want
our future to be?

In my teaching around the world, I often cite the vision of Ittiam as an excellent example of how
powerful an entrepreneurial vision can be. Ittiam¶s story is told in the November, 2007 issue of
DARE. Founded by seven senior managers who left Texas Instruments in India to pursue their
joint dream, Ittiam has become a leading provider of original software for digital signal
processors. The founders¶ vision was to create the first made-in-India company with a billion
dollar market capitalization built on original intellectual property, as opposed to process
outsourcing or services.

Ittiam has not achieved that dream yet. But it has animated the firm for years and provided a
guidepost when the firm reaches a crossroads. Ittiam¶s compass points to true north when it acts
in a way that makes it more likely that it can build a company whose intellectual property in the
form of proprietary software is valued by the market at a billion dollars. Hundreds of
extraordinarily talented employees have stuck with the firm through thick and think because they
believe their joint enterprise is truly worthy of their commitment.

Especially now, in difficult economic times, you may wish to revisit your entrepreneurial vision,
and give it a tune-up if necessary. First, ask yourself if the people who work in or with your
organization have a shared ³movie in the head´ that allows each one to perceive vividly what
tomorrow will be like if you achieve your dreams, and why it would be worthwhile to live in that
tomorrow. Second, ask how you measure progress toward your goal and what tells you that your
vision is helping you to move forward. How do you know you¶re advancing toward your better
tomorrow? Third, look back on some of the tough decisions you have had to make. Ask yourself
if your vision helps provide you a basis for choosing. Is your vision a compass that helps you
sustain a consistent direction, even as the path you pursue twists and turns?

Finally, think about when it is time for your vision to undergo a re-vision. A particular vision
that once was an effective means toward various ends can lose that potency. When you realize
that your vision is failing any of the three tests I have described, it¶s time to revisit your true
purposes and find another way to describe a better tomorrow that those who must work to
achieve it believe is worth the struggle.


 

 
 

alit Agarwal established V Mart Retail in the year 2002. The company made its foray into the
retail sector in October 2003 by opening its maiden showroom in Ahmedabad. As of now, he has
successfully driven the business to have a 150 crore plus turnover and have a presence with
ü7 fully-integrated stores in 44 different cities spread in an area in excess of 400,000 square feet.
Agarwal speaks to DARE about his entrepreneurial journey, and shares his knowledge about the
industry

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My family has been in the business of retail since 197ü. I formally entered the business in 1999. I
come from the same family as RC Agarwal of Vishal Retail, who is my first cousin. We started
our business from Calcutta, and we were among the first ones to enter the market in an organized
fashion. We saw slow but steady growth in our business, which I believe happened due to us
being very open to implementing innovations, such as bar-coding products, being a fixed price
shop, opening up a chain of stores etc.

In 2003, we realized that we were not thinking on same

lines, and we decided to part ways. That is when I started
this retail chain called µV-Mart¶. We opened our first
store in Ahmedabad, Gujarat in 2003, and since then we
have not looked back. Our store is basically a mini-
hyper-mall kind of a model, wherein each of our stores is
approximately 10,000 square feet, catering to the middle
class segment of the market, and mostly women and
kids. We also nurture the aspirations of the middle class
and have top-end products with us. By doing so, we have
always had wide horizons on X-axis as well as Y-axis.
Our group started its corporate journey with a mission to
bring quality garments within the reach of the common
man. We have a huge product line that lives up to our
punch line ³Sabse Sasta Sabse Achcha´ (cheaper than all
others, better than all others), wherein we try to get into
the customers psyche, and make it a point to not charge
any royalty, or offset product prices based upon the store
location, and such. We offer products at the minimum
margin and try to give the customers value for their money. As of today, we have ü7 fully-
integrated stores in 44 different cities spread in an area in excess of 400,000 square feet.


 
   
 




 
 
 



 





 



First and foremost, you need to identify what products you are going to deal in. When you zero
in on that, ask yourself if you know what is the best way to source the product, price the product
and display the product. Secondly, you should know where to sell these products, in terms of
store location, as well as placement of the products within the store. Price is the third key thing to
keep in mind. If you are targeting the masses, and even slightly overprice it, it will result in a lot
of bad business. Also, you should know that you should arrive at acceptable price points of
products, while keeping in mind things such as the investment that you have put in, and such.
The fourth important element is to understand this Hindi phrase, ³Jitni badi chaddar ho, utna hi
pair fehlana chahiye´ (spread your legs only as much as the sheets can accommodate). This is
very important when thinking about expanding your business. The fifth and final thing is that
you should put a lot of thought into knowing how to market your products, your brand, and
publicize your chain of stores.

 
 


 

 

 
 


 

Almost everything that is out there in the market reaches the customers through a retail format.
In our experience though, even though we have managed things very well, we have seen that
electronic goods have not done all that well. Also, we have seen a similar thing happen with
retailing footwear, which could have done much better than it has.

 




  



 

Every entrepreneur in any segment of business will face various difficulties when they set up a
business or try to grow the business. However, in retail, human resource is a big challenge. One
does not require a lot of highly educated manpower, but you do want them to have good general
knowledge, be street smart, have a sense of loyalty and be principled. As an entrepreneur, you
should be very particular about how you want you handle your manpower and frame the HR
policies that facilitate your vision.

 
 



 

The biggest success for me, I would say, was setting up our first store in Ahmedabad. This store
was the first one in our venture and we were the first to enter in the markets in the west of India.
We begun as an ordinary retailer in this category and we tasted grand success almost instantly.



 
 
   
 

Well, we had opened a store in Navi Mumbai, and that turned out to be a learning experience.
This store did not do well at all. The reason behind it was wrong selection of place, wrong
selection of market etc. The city itself is so large and just having one store out there does not
really help in making your presence felt. This experience made me realize that one should not
over estimate and enter markets that are not suitable for you or markets that you are not ready
for.

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I would not say that I did not see a downfall of business. While the market has seen a lot of retail
chains close down many of their outlets, we also had some of our outlets relocated. Now,
relocation is a part and parcel of the business, and is not so much directly related to the
slowdown of the economy.


 
 

 
 

 
   
 




I would say one should avoid getting carried away with the existing business scenario. It is
common sight to see people drift away into a mindset wherein they think that doing a business is
all about investing some money, doing some marketing, giving out some discounts, and the
business will flourish. The aspiring entrepreneurs should not be thinking so much about
profitability, as much as about product line or services.
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·extWealth Entrepreneurs, whose vision is social uplift through entrepreneurship, has been co-
founded by Dr Mitta who has nearly four decades of experience in information technology R&D
and related businesses in India and the United States. He joined Wipro at its inception in 1980
and served as its chief technology officer

and head of global R&D. He played a critical role in helping Wipro achieve technology
leadership²the company became the highest valued company in India during his tenure.

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The entrepreneurial ecosystem in India is reasonably mature. For example, funding should not be
a problem for deserving entrepreneurs with good business plans. We have angel investors,
venture capitalists and private equity investors who can invest at different stages from half a
million dollars to several hundred million dollars. However, we are yet to see substantial value-
add from investors in terms of mentoring, business
strategies and marketing.

We also need to evangelize entrepreneurship at an early

age so that young people can start thinking in terms of
creating jobs rather than taking jobs. Here again, we see
organizations like The Indus Entrepreneurs (TiE) and the
National Entrepreneurship Network (NEN) doing a
commendable job. Some of the premier management and
engineering institutions like IITs, IIMs and IISc have
started incubation centers, business plan competitions
and seed investments.

Recently, Peoples Education Society (PES) Institutions

in Bangalore started a center for entrepreneurship with
amazing results.

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As all of us know that failure is a stepping stone for success. This is valid more so for
entrepreneurs. In the Silicon Valley, there is premium for those entrepreneurs who failed earlier
compared to those who are attempting for the first time! Good entrepreneurs will learn how not
to do things from such failures. In India, people tend to blacklist entrepreneurs who failed in their
first attempt. But we expect that in near future, earlier failures will not deter investors.

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Several traits of an entrepreneur, like the ability to take calculated risks, build a team, willingness
to work hard against all odds, staying focused etc are more natural. One can be taught about
things like tools required to manage, metrics to measure performance, business plan development
and proper alignment between market and technology. But, Investor of the Month is no
replacement for a good and experienced mentor.




    
 



 

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Technology is a key element of many startups. Even service startups have to use technology to
move up the value chain and can't merely depend on wage arbitrage forever.
 As told by: Anand Talwai, Co-founder & Executive Director, NextWealth

Today, technology products or technology itself are offered as services. So, it is less likely that
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NextWealth Entrepreneurs started with a simple vision of social upliftment through

entrepreneurship. It is built as a social entrepreneurship venture that blends social intent
with commercial acumen. It operates in the ITO/BPO industry space. To achieve its
objectives, NextWealth has developed an innovative strategic model, a highly distributed
delivery model that draws upon groundswell of graduates and entrepreneurs in non-metros
and rural areas. At the same time, the model ushers in a great social value proposition.
NextWealth¶s model envisages a large number of small centers (each having 200-2ü0
graduates) located in non-metros in India more akin to the Internet or cloud model of
computing.

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A key element of its business model is to enlist participation by local entrepreneurs who have
emotional attachment to the place, are financially strong, and are competent to manage the center.
Unlike managers from cities deputed to non-metros, these entrepreneurs have a social agenda in
addition to achieving business success. NextWealth selects these entrepreneurs very carefully and
mentors them. Some of them even go through an entrepreneur-in-residence tenure before they
start the center. They are responsible for recruiting and delivery of services and strive to make
each unit a center of excellence for a specific process.

Local entrepreneurs will provide a multiplier effect in enhancing values of the social and economic
ecosystem in non-metros where NextWealth centers are located. A typical center achieves cash breakeven in
12 to 18 months and profits thereafter. NextWealth takes an equity stake in the centers to demonstrate its
commitment to customers and entrepreneurs.

NextWealth takes the responsibility of bringing together the right combination of customers, projects,
entrepreneurs and skills. They undertake customer acquisition activities and get services delivered from
various centers by providing technology, training, process management etc. The ideal processes that lend
themselves are based on a technology platform that enables automation and needs some amount of
customization, personalization and human intervention. Internet content monetization and chat-based
support are some of the examples.

 
NextWealth plans to employ 10,000 engineering and other graduates from non-metros in the next three
years by creating forty centers. At least 40 percent employees will be women and 1ü percent persons with
disabilities who hardly migrate to metros. The locations are selected based on the availability of talent from
established engineering colleges and basic infrastructure like power backup, bandwidth etc.

By remaining closer to their homes, the employees will have a better quality of life. This may even promote
reverse brain drain from metros to non-metros. Currently, there are three centers located at Mallasamudram,
Tamil Nadu; Chittoor, Andhra Pradesh and Amargol, Karnataka. Over 200 graduates are currently
employed, delivering several pilot projects in the last six months. These projects demonstrate that graduates
from non-metros can deliver same or better quality services at substantially lower price points compared to
metro centers.
Entrepreneurstechnology startups will be overshadowed by others. Earlier, technology startups
were primarily in the area of
information technology. However, currently we are witnessing ventures coming up in diverse
segments like alternate energy sources, nanotechnology applied to commercial applications etc.

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Normally, non-governmental organizations (NGO's) and 'non-profits' try to do good. They are
committed to a cause and driven by social objectives. But, they are dependent on grants and find
it difficult to scale. Donors find NGOs and non-profits less accountable.

On the other hand, corporate organizations and 'for-profits' try to do well. They are committed to
the business and are driven by profit objectives. They are self-sustaining and emphasize on
scalability. They are accountable to investors, customers, government and other stakeholders.

Social entrepreneurship blends in an equal percentage of social intent to do good to meet societal
needs and do well by remaining commercially viable like any business. The idea of social
entrepreneurship is gaining momentum globally and in India too. Time has come for all
businesses to look at profit and social good as compatible, rather than conflicting, characteristics
of modern businesses.

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The Aravind Eye Care System at Madurai is a sterling example of social entrepreneurship.
Founded in 1976 by Dr G Venkataswamy, with the mission to eliminate needless blindness,
Aravind is the largest and most productive eye care facility in the world. Taking its
compassionate services to the doorstep of rural India, Aravind's stunningly effective strategies
vaulted barriers of distance, poverty and ignorance to create a self-sustaining system. Nearly ü0
percent of patients are treated free and the rest pay nominal charges. Yet, Aravind is a profitable
and growing venture without external doles. Over 2.ü million out patients were treated and over
300,000 surgeries were performed during the last financial year.

We have started NextWealth Entrepreneurs to provide decent jobs and careers to graduates from
rural and non-metro areas to work close to home, with a business model that is scalable and self-
sustaining.

Vimarsh Bajpai

 





 

Entrepreneurs need to make sure that their ventures reach break-even and show returns early

You are aware that entrepreneurs have to be philosophers. In today¶s environment, Facebook and
other social media have turned all of us into philosophers anyway²we keep posting pearls of
wisdom.
So let me elaborate on

what I mean by the title of this column²Light at the end of the tunnel. I simply mean to ask,
when will a new venture turn profitable or at least break-even. In the era of bootstrappers, about
whom I wrote in the last issue, this question becomes even more pertinent. How long should an
entrepreneur fund a venture before it starts breaking even? Of course, there is no standard answer
or formula. It depends on the sector, the nature of business, the scale and the skill-set of the
entrepreneur. It also is determined by the environment.

The only guiding principle I would like to propagate and share with you is that like the human
body which generates its own healthy blood for itself and keeps the body in shape and disease-
free, the venture needs to generate its own revenues at some stage to become like a human body.
We know that any human body that does not produce its own healthy blood at some stage can
become weak and fade away or not be able to live well. The body at some stage can take doses
of blood from outside but at best these need to be supplements.

The startup business enterprise needs to become a healthy self-sustaining body in

order to survive and thrive. The entrepreneur is like mother or father who realize
the baby needs to stand on its own.

Let me take the case of the industry I know little bit about²yes, I am talking of
the media and entertainment industry. We know that most television ventures did
not make money but still enjoyed unbelievable valuations. I believe those times
are over. The days of long gestation periods and long days of break-even for startups are over.

The investors wish to see traction early and could lose patience and interest in the venture if
there is no light soon at the end of the tunnel. Entrepreneurs and ventures who can start showing
faster break-evens and better cash-flows will soon attract more capital and attention.

What I am saying was always the case, but I would say the investors' outlook on this in last few
years has become even more clear and demonstrable of this trend.

My five suggestions for a budding entrepreneur:

1. Keep costs low

2. Get yourself to be a key contributor so that your equivalent cost can be eliminated
3. Try and do deals with partners' vendors that are linked to the venture and company's
growth
4. Share the wealth as well as the risk with your core startup team
ü. While low costs are welcome, there are some mission-critical and core aspects that need
to be done on a certain quality and scale²don't be penny wise pound foolish in those
aspects.

I must also share that business plans are likely to go awry as the environment and competition
are dynamic so having a mentality that I have talked about above is something that will keep you
in good stead.