Startup Saturday: Failure in the house: lessons from the falls
Pune even saw an event called the F*** Up Night, where founders of companies spoke about failures and learnings from them. This week three startup founders share their failure stories.
Lesson learnt: Know every little detail about for your business
Prathamesh Korgaonkar, founder Focus Medium Solutions and Kicktech Box Inc
In 2013, Korgaonkar, an IT engineer working at Cognizant, developed a new product – a multifactor authentication tool that could be ubiquitous in the financial industry, given the need for security.
“I was working at Cognizant when I started working on this multifactor authentication tool – a Smart Watch. All went well with the hardware. It worked at the PoC level and so I filed for a patent in India in 2013 and later for a patent in the US. Unfortunately, this turned out to be my biggest mistake.
The big mistake
“I knew patents in India take about five years, so I filed for a patent in the US after filing for the Indian one because there a patent takes three years. After filing for patent I thought, why not start looking for funds in the meantime?
“I met a lot of investors, but unfortunately investors are very passive about hardware and products so it was quite difficult. Khosla Ventures evinced an interest but wanted to buy out my IP.
“VCs in the US are more willing to invest in a startup so I decided to do my MS at California and simultaneously search for funds to set up my Smart Watch company.
“Then it was just bad luck. I had to come to India for my sister’s marriage after completing a first semester at a California university. They debarred me from entering the US from San Francisco airport by saying I am not intellectually and financially fit to continue my education in US. They also banned me for five years.”
“In 2016, I received my US patent, but the India patent is still pending. Because the original patent was filed in India I cannot use the American patent alone. The original patent has to be cleared first.”
“It was my biggest mistake to not get into the nitty-gritty of patent filing, its procedures and time spans. Because of this problem I shut down the idea completely.
Korgaonkar fought a legal case against his de-barrment from the US and won.
Today, Korgaonkar is growing his second business venture Focusmedium Solutions, a digital marketing agency and, a digital marketing service in Delaware, US, named Kicktechbox, Inc, aimed at ecomm platforms.
Lesson learnt: When to pull the plug on your business
Sandeep Saxena, founder, Hapy India, a startup that produces videos
“In 2005 I started Acton biotech where we offered genetic testing to determine the best line of treatment for diseases such as cancer and the chemotherapy. From 2005 to 2014 we were doing extremely well with great revenues and building partnerships.
The big mistake
“I was forewarned by my investors that the “big guys” are planning to enter this segment. A small fry like me stood to lose ground. I didn’t listen, or perhaps I didn’t want to believe that what I had grown with my sweat and tears would just roll over.
“And that was my biggest mistake.
“Soon it was impossible for me to compete with the deep pockets that had entered the business. It was impossible for me to offer the rates they could. “Impossible for me to reach out to the number of customers they would. I could not afford a large marketing team. It was not long before I started making losses.
“I should have paid heed to my investors’ advice and either sold off or got into a JV. I had to shut shop. I sold my equipment to a hospital.
“When your revenues are high, there’s cash in the bank and you see large competitors on the horizon, it’s time to say adieu to your baby.”
Lessons Learnt: Know everything about the business
Akshit Mehta, founder, Vork coworking spaces
“I comes from a family of realtors. However, the real estate business didn’t excite me and though I worked with my dad for a few years I was not really into it. Marriage happened and my wife Anjali, who’s into interior designing, suggested I look at the business “of giving out desk space”.
“I had tried a fitness venture, however, finance issues made me quit that.”
“I leaped into the desk-space business. I rented 5,000 sqft in Andheri and Anjali did the designing. We were open for business on Oct 10, 2016.
“It was three months since we opened and not a single seat was sold. Then demonetisation happened and we got our first client. In 2017 I opened another centre at Lower Parel and later, one more at Kala Ghoda. Those centres, too, went through their ups and downs, doing occupancy at 35%, then 80% and 100%, and then back to 35%”
The big mistake
“I realised that I needed to know more about the business. I attended a conference on coworking spaces and that really opened up my eyes.
“When I started in Andheri, I had no research done, had no idea about the business. I did not understand how people calculate distance from local transport.
“For an entrepreneur like me, I have to keep it niche. I cannot and am not interested in 5,000-seater work spaces. My target audience is the shared ecosystem where everyone knows everyone.
“I am bootstrapped. I have invested Rs 2.8 crore and have to be very careful of how I spend it. While I may break even operationally, breaking even with my capex is hard.”