An IISc Seminar: The Beginning of VNIR
You know that a talk has left its mark in your memory lane when you can vividly reminisce every detail that was discussed, a month after. The startup centric talk conducted by Dr. Meher Prakash is an exemplar, in this regard. From the word go, the narrative style of presentation captivated the attendees. Furthermore, it was an eye-opener in the sense that there was a realisation that whole startup culture could not be stereotypically attributed to a business perspective alone. The very fact that a postdoctoral student from CalTech and ETH Zurich ventured into establishing two startups is reason enough to validate the same. This article delineates the instances and points underscored by the speaker.
The Importance of Having a Vision
Before venturing into a startup , convincing yourself of the vision and the impact is sacrosanct. Is the idea unique? Is it potentially scalable? Sky is the limit when it comes to dreaming big; he wanted to create a global impact with regard to cellular imaging. Surprisingly, their team proposed a name for the startup, only to realise that 40 other startups with similar names already exist! As inconsequential as it sounds, having 20 iterations of rejections and re-naming, spoke multitudes of the competition in their area of interest.
When their team decided on designing a product, they had to consider a few aspects.
- Imaginable Scalability: Their business was bulk-scale. In short, they made high profits from a few target customers.
- Target: These were researchers primarily.
- Uniqueness: For a mutual inertia amongst users, he spoke of the 10X rule which has been elaborated on, later.
- Sensing the Market: Aggressive promotion and advertisement was essential.
- Product Usage and Scope: To decide if their product was for diagnosis, early diagnosis or prognosis.
“The startup experience is dynamic and once you step into it, it becomes addictive.”- Dr.Prakash
The 10X Rule
With the increasing competition, are there times when you’ve wondered if your product or business will sustain? Is there any mantra in assessing if the product or idea is impactful? He highlighted the importance of this rule, in most aspects of his decision-making as an entrepreneur. If you are designing a product, see to it that it’s 10X better than the state-of-the art (in terms of application and results). Or fix the price to be 10X cheaper than the cost of similar products. It’s as simple as that! Incremental steps won’t help. Unless you’re going to have these humungous 10X leaps, your product will not draw the attention of potential customers. In short, he emphasised the application of this rule in product scalability, accuracy, uniqueness, pricing and usage. Also, this assures that you’re way ahead of your competitors. Here’s a great article on this.
“Basically, the 10X rule is an idea that every project you do will take 10 times more time, energy, money, and effort than assumed, so set the much more difficult expectation, and if it happens to take less, then great. Too often, people set out to accomplish challenging goals (e.g. I want to build a successful business, I want to lose 20 pounds, etc.) and don’t set even remotely realistic expectations. However hard you think it is, set expectations for it to be 10 times harder and then you’ll be in the ballpark. Put another way, most people don’t reach their goals because they didn’t work hard enough at it.” - David Cummings
Time is an Illusion
When a customer tells you that they will get back to you in a day, they will take a week at the least. And if they say they need a week’s time, you can rest assure that they will take a month to respond. Likewise, a month should be interpreted as a few months or a year. See the trend? His venture involved a few customers who would buy the product (near infra red fluorescence probes) in bulk. Despite targeting a few potential customers, expecting timely responses and sticking to rigid deadlines turned out to be impractical.
Early Startups Must Have Investors
Before completing his postdoctoral studies, Dr. Prakash was the founder of another startup which made a non-corrosive dye for metal surfaces. Since they had to sell samples, the operation costs were minimal. Although the first startup could not sustain the desired business growth, the entire experience was a cornerstone in the ideation phase of VNIR, his second start-up venture. This time, he decided that the he would not be the CEO.
“Before I stepped into the world of startups, I would always criticize overblown pricing. For instance, if a plate of Biryani could be bought for Rs.50, then why did food stalls charge Rs.250 for the same? It later dawned on me that they have to compensate for the bad days. The days where they have low sales, fewer customers, increasing costs of raw materials (ingredients) or lesser employees.”
-Dr. Prakash
Inspite of being approached by many angel investors, he didn’t approve of them. This was one of his biggest mistakes. He confessed that he was hell-bent on approaching them later, when his company made significant profits. And once his company did make reasonable profits, this was tabled for a future date when he would make some more profit. But that never happened.
When we fast forward to a few years later, he invested 1.5 crores in VNIR and started looking for angel investors well in advance. Planning for the next 1–2 years of operation was a priority.
Incubators and Government Funding
A business incubator is an established institution that provides mentorship, initial funding, work space, investment and networking opportunities. At present, VNIR has its base at the Jawaharlal Nehru Centre for Advanced Scientific Research (JNCASR), Bangalore. According to him, the benefits of such incubators must be leveraged. If you’re looking for startup incubators in India, Bangalore is teeming with them!
What about government funds? Well, you could certainly use them…if they are adequate. He recollected an incident where they wanted to avail 50 lakhs via government funds. The Indian government supported them with 20 lakhs. Guess that’s better than nothing. Having said that, one cannot solely depend on government funds to support their startups.
Does a Startup Need a Salesperson?
“Most of the people we approached, gave us advice, schemes and plans on how to increase profits. But none of them spoke of ways in which we could make profits while starting at ground zero, with no revenues.” — Dr. Prakash
This depends on what the startup is about and its scope. They did not find the need of a salesperson or someone with a degree in Marketing, since their business was small-scale. In fact, what they required was a financial advisor. Their financial advisors had a better market awareness and helped in making business-decisions, so that they could scale up their business.
In this context, he mentioned the concept of a sales funnel. Creating a sales funnel helped them analyze the path taken by prospects in becoming customers.
Lastly, a common notion would be to assume that the founder is a know-it-all. Ironically, he or she is ‘figuring out’ what works best for the startup company- just like any other employee.
“My job was to make my research partner realise that he has the ability to discover something new. I didn’t discover it. I motivated him to.”- Dr. Prakash
The Random Walk
“Without unpredictability, there is no thrill.”- Dr. Prakash
His journey was full of ups and downs. Initially, his first startup venture saw 6 months of success. His bank accounts were brimming with cash. However, things started taking a downward spiral eventually. He realised that his product could not sustain the market. This led to fewer customers and that, in turn, led to lower revenues. It was a domino effect.
In the midst of such a downfall, he decided to pursue his postdoctoral research. However, his startup craze did not die down. Along with his colleague at JNCASR, he came up with the idea of infra red fluorescence probes for cell imaging.
Generally , a blood sample is smeared on a glass microscope slide and stained subsequently. Following this, an expert analyzes the slides. They wanted to make chemical probes that would help in diagnostics by lighting the regions under study instead of existing stains. To this end, they offered a fluorescence molecule with far-reaching applications. For instance, this could also be used with the cerebrospinal fluid obtained during a lumbar puncture procedure, in order to detect Alzihmer’s disease. Was their idea unique? Have a look at the figure and think for yourself.
Conclusion
Their immediate goals are as follows:
- To find ways in which their product can be modified for prognosis.
- To scale-up their venture to a corporate level. This would ensure better revenues.
VNIR has several patents to their name and continues to make significant contributions to the research sector. You can visit their website to learn about their current work.
Note: This is my first attempt at writing a startup related article. Any suggestions are welcome. Also, this article certainly doesn’t do justice to the talk.
If you’re heading a startup, do check out the Launchpad Accelerator Program by Google Developers’ Group. Additionally, if you’re a female entrepreneur, make sure that you apply for the AnitaB.org Women Entrepreneur Quest :)
