Learning from failures — The Qplay Story

The best thing to do before you start something new is to talk to someone who has done it successfully before you and Sijo gave us the perfect opportunity to do that by introducing us to the founder of Qplay, Mr. Nithin George to fulfil our dream of becoming an entrepreneur.

Qplay Tech Private Limited was established on 22 August 2013 by Dheeraj Prasanth, Nithin George, and Jacob Mani. It is a Non-govt company and is registered with Registrar of Companies, Ernakulum. It has an authorized share capital of Rs. 1,060,000 and a paid-up capital of Rs. 540,000. It is into Software publishing, consultancy and supply. Software publishing includes production, supply and documentation of ready-made software’s, operating systems, business & other applications software’s and computer games software for all platforms. Consultancy includes providing the best solution in the form of custom software after analyzing the user’s needs and problems. Custom software also includes made-to-order software based on orders from specific users.

During the conversation with Nithin, he gave his insights based on our queries.

THE EUREKA MOMENT FOR STARTING QPLAY

Initially, there was no idea or intention to create such company and get into the field of entrepreneurship, like every other middle class Engineer in our country Nithin too had a very clear-cut objective to get into a company like Microsoft or Oracle.

Expecting to get into Microsoft, Nithin used to participate in several coding Competitions and Hackathons, One such Hackathon was the Blackberry Jam India where he and his team Stood as winners and later went on to represent India in Blackberry Jam Asia Level.

During this process, many of the students in the Student community and various participants were seen to be representing either a Corporate or a start-up in the competition. Companies like TCS and Wipro would take these students as interns and were more interested in student community, So Nithin and his team came up with an idea to create a start-up and represent it on a public platform. They were reported as Representing a start-up called Qplay this was the inception of Qplay and since then they started working on few projects under this name, mostly hobby projects and Nithin later on did his Final year project for the college and it was converted as the first official project for Qplay. Therefore, the idea of starting up a company was more of a requirement than an intention to do so, but in future Qplay succeeded in becoming one of the leading start-up in this space.

FINANCIAL ASPECTS

As we observed that, the founder had raised 1.5 to 2 Cr in the form of equity. Equity fund will be expensive when compared to loans taken from abroad like Luxembourg, Europe and Japan. The fund providers may expect approx. market average return of about 12–14%, which leads to increase the operation leverage of the firm. So is it a better way to go for funds from abroad at cheap interest rates about 1.5–2%, maybe even below that.

Nithin’s opinion about this is start-ups start at a small scale at the initial stages, later on go for raising funds at large to grow large. Generally, start-ups fetch for venture capitalists for fund raising. Raising funds from abroad is impressive but here comes the issue the currency forex volatility, inflation rates, providing credibility approval for lending bank is not easy, security deposit with the lending bank and need to follow RBI approvals for the amount restrictions upon the amount that can be raised from abroad. Vc’s follow 6–3–1 rule which means they don’t care about funding start-ups, they portfolio their investments in few firms out of which only one firm will make hefty returns others may fails. This is better way for start-ups to approach VC’s and be funded. Generally, out of 20 VC’s meeting one may be the fund provider as said by the founder and also he says that above said risks can be avoided by not taking funds from abroad and go with VC’s in the home country. However, VC’s do not expect 12–14% they expect huge returns about 40%, but they fund high if they see there is scope for the start-up in the market.

In addition, the question was thrown about the diversifying the portfolio of business to Nithin. The reply to which was that Qplay is going to diversify in the field of augmented reality in fashion services a hybrid model of product and services. The founder is curious about the scope in this field in the near future a technology that superimposes a computer-generated image on a user’s view of the real world, thus providing a composite view. This creates a new era for the fashion segment after the final augmented product is launched in the market.

ABOUT ORGANISATION STRUCTURE AND TAKING UP JOBS. WHETHER HE BELIEVES IN MULTIPLE APPLICATIONS AT A TIME PARALLEL OR ONE PROJECT AT A TIME

The organization structure is pretty simple which consisted of a group of engineers who mainly concentrated on one project at a time. With overall understanding about the company, it is evident that people get assigned to jobs depending upon the project that comes in the way and no specific person takes up the same job again and again.

They use the hybrid model of products and services and their last two Products and this product is funded mostly by service revenue and consultation revenue. When it comes to consultation products or services they have multiple products. But when it comes to a product they are concerned about each individual product and multiple projects won’t affect the quality it will affect the capacity because they use same engineering process for all the products.

WHAT ALL CHALLENGES WERE FACED

It was very heart-breaking to shut down the first project and to start a new project — Qplay he gives away 80% of 1.25 crore worth investment all of a sudden to the investors. But on another hand, it was very humbling experience for Nithin

The biggest challenge was community and ecosystem.

As it is very hard to handle friends and family because they put the entire blame on you when something goes wrong and reason can be that they have always seen success throughout the academic career. Failure makes you empathetic to other founders and it also helps you to cut down a lot of your ego. It is important that every founder should go through at least one failure in their career. Only then, one will start appreciating successful people.

TIPS GIVEN BY NITHIN FOR BUDDING ENTREPRENEURS

One has to be very careful when you choose your co-founder.

Everyone should know to ask for a help. In corporates, people generally don’t ask for help, it shouldn’t be like this, be shameless to ask help from the beginning as most of the entrepreneur is ready to help. Nithin says all the successful Entrepreneur has given him time to make him understand the reality and he is following the same by making us aware.

ASPECTS TO BE CONSIDERED TO CONVINCE A VENTURE CAPITALIST

· Before approaching a venture capitalist it is prudent to have a financial model in hand

· While pitching should a venture capitalist decline to fund your project, one should not take that as a complete failure

· Ideally asking for funds in large amounts is better than asking for a small amount as a venture capitalist won’t consider it seriously

· Venture capitalists always look for a project, which has a higher probability of success depending on the type of industry and your team’s composition. For instance, should your project be associated with block chain, which is the future of technology, it is likely that a Venture capitalist would engage and move forward with your project.

IMPORTANT POINTS TO CONSIDER FOR A STARTUP

· Having connections is important for startups, especially for raising funds

· LinkedIn is also a good platform to find Venture Capitalist firms

· Talking to multiple investors is always an added advantage. For instance, talking to at least 20 Venture Capitalist firms allows one to assess how sound their project is and how likely an investor is to approve a funding

Here’s the founder’s story in his own words:

https://drive.google.com/file/d/0BzQJBY-9w8pxU2Rid1c0T3djdnM/view

CONCLUSION

It was an interesting session of about 40 minutes with Nithin. We had prepared few questions for him to clarify our doubts. He gave detailed insights about his firm. As the session progressed, we came up with more interesting questions and he happily replied to all of it. We had a very friendly interaction with him and we really appreciated that he gave us his time to us. We learned two interesting things from this session:-

· To become successful, it is important to learn from failures

· Do not be shy about asking for help. It does not mean that you are weak; it only means you are wise.