Startups and Shutdowns Deepak Shenoy

Background Engineer, Comp Sc., KREC Surathkal 96 Started Agni Software in 98 Four partners, Software Developers Joined Flovate Technologies in 2005 Company sold to WNS in 2007 Started Moneyoga in 2007 Shut down in Dec 2008

Engineer, Comp Sc., KREC Surathkal 96

Started Agni Software in 98

Four partners, Software Developers

Joined Flovate Technologies in 2005

Company sold to WNS in 2007

Started Moneyoga in 2007

Shut down in Dec 2008

Three startups, Three Exits Agni : Inertia Flovate: “Exit” as we get to hear it Moneyoga: “Exit” as we don’t.

Agni : Inertia

Flovate: “Exit” as we get to hear it

Moneyoga: “Exit” as we don’t.

Why did I start-up? I always wanted to run my own show Be my own boss Too arrogant or stupid to think otherwise Nothing to lose if you build it, they will come

I always wanted to run my own show

Be my own boss

Too arrogant or stupid to think otherwise

Nothing to lose

if you build it, they will come

What I learnt You are never your own boss

You are never your own boss

You want a boss So that you can ask for a raise Or at least, have someone else to blame for your mistakes

So that you can ask for a raise

Or at least, have someone else to blame for your mistakes

You also need Arrogance Stupidity Fear of failure Come to Jesus = Bank balance Thick enough skin to not care how many houses your friends bought And look where that got them.

Arrogance

Stupidity

Fear of failure

Come to Jesus = Bank balance

Thick enough skin to not care how many houses your friends bought

And look where that got them.

Business Plans Are toilet paper But they are hajaar fun And they make you think. At least the stupid ideas go out the window

Are toilet paper

But they are hajaar fun

And they make you think.

At least the stupid ideas go out the window

VC Stories VCs get maligned a lot But they have the money Golden rule: He who has the gold… Presented to a ton of VCs That there was money online And that too, in advertisements on a stock market portal Okay, that makes us look stupid today.

VCs get maligned a lot

But they have the money

Golden rule: He who has the gold…

Presented to a ton of VCs

That there was money online

And that too, in advertisements

on a stock market portal

Okay, that makes us look stupid today.

How did we fund Moneyoga Worked out of home Bought a server, a desktop and a laptop Total startup cost was 1 lakh No hiring, no office, no other expenses 1.5 years worth of cash expenses For each of us

Worked out of home

Bought a server, a desktop and a laptop

Total startup cost was 1 lakh

No hiring, no office, no other expenses

1.5 years worth of cash expenses

For each of us

What did we do? Built a web site Got 1000+ page views a day before we even advertised (our longer running blogs get 2.5K a day) Gave up on internet statistics Gave up on online users Less than 30 lakh people trade online Less than 40 lakh broadband “connections” in the entire country Deduplicated, this is not worth the effort

Built a web site

Got 1000+ page views a day before we even advertised

(our longer running blogs get 2.5K a day)

Gave up on internet statistics

Gave up on online users

Less than 30 lakh people trade online

Less than 40 lakh broadband “connections” in the entire country

Deduplicated, this is not worth the effort

The Hedge Fund Model In April 07, decided we would trade our “algorithms” Wrote code, acquired data, put some cash on the line First system up in May 07 Traded four overall, rejected two and employed the other till October 07 Made 20% in four months

In April 07, decided we would trade our “algorithms”

Wrote code, acquired data, put some cash on the line

First system up in May 07

Traded four overall, rejected two and employed the other till October 07

Made 20% in four months

Exit Needed a certain amount of AUM to make money Our cash would last only till end-December We couldn’t get there Reasons, shmeasons Decided to “stop out” at end-December Undercapitalised The model still works “ We’ll be back”

Needed a certain amount of AUM to make money

Our cash would last only till end-December

We couldn’t get there

Reasons, shmeasons

Decided to “stop out” at end-December

Undercapitalised

The model still works

“ We’ll be back”

My learning I learnt a lot Bookkeeping, accounting, and why we pay so much in taxes Despite what we think, the government is amazing online Money is everything, when you don’t have it There’s a fine line between bravery and stupidity Starting up is overrated

I learnt a lot

Bookkeeping, accounting, and why we pay so much in taxes

Despite what we think, the government is amazing online

Money is everything, when you don’t have it

There’s a fine line between bravery and stupidity

Starting up is overrated

My learning We are way too early for a niche internet in India Quality journalism is missing. But no one will pay for it. VCs will always appear clueless. Appearances are deceptive. Some of the best VCs I’ve met (non clueless) Alok Mittal Prashant Prakash

We are way too early for a niche internet in India

Quality journalism is missing. But no one will pay for it.

VCs will always appear clueless. Appearances are deceptive.

Some of the best VCs I’ve met (non clueless)

Alok Mittal

Prashant Prakash

More learning Money is everything. Effort is nothing. If your company makes money by denying you a market salary, it is not making money You can get a better price for everything. “Let’s do this, and then we’ll see” is stupid If at first you don’t succeed, tell everyone about it.

Money is everything. Effort is nothing.

If your company makes money by denying you a market salary, it is not making money

You can get a better price for everything.

“Let’s do this, and then we’ll see” is stupid

If at first you don’t succeed, tell everyone about it.

My piece of advice Don’t listen to people who give free advice Unless they are Guy Kawasaki or Paul Graham And even they are wrong sometimes.

Don’t listen to people who give free advice

Unless they are Guy Kawasaki or Paul Graham

And even they are wrong sometimes.

Ok, but still It’s cheaper to start up if you know when you must shut down It’s your “uncle” point You know when it will come

It’s cheaper to start up if you know when you must shut down

It’s your “uncle” point

You know when it will come

Don’t let the bozos get you down Sorry, Guy Kawasaki

Don’t let the bozos get you down

Sorry, Guy Kawasaki

Failure is not a bad thing For one, it’s a huge resume booster

Failure is not a bad thing

For one, it’s a huge resume booster

Have I been discouraged? Of course I’ll do it again When I next have the money

Of course I’ll do it again

When I next have the money

Questions Email: [email_address]

Email: [email_address]

How to write a business plan Use excel. Do NOT start with a profit figure and work backwards Do not write “worst case scenario”. Your “worst case” will seem like a bed of roses later. Leave enough snarky comments Because you gotta enjoy coming back to it

Use excel.

Do NOT start with a profit figure and work backwards

Do not write “worst case scenario”.

Your “worst case” will seem like a bed of roses later.

Leave enough snarky comments

Because you gotta enjoy coming back to it