Steps I would take to start a new venture today - how to improve the chances for success?

Colin R. Davis once famously said, "Success is not the key to happiness. Happiness is the key to success. If you love what you are doing, you will be successful." This quote beautifully captures the essence of finding fulfilment and accomplishment in one's life.?

Entrepreneurship is one of the most exciting journeys one can take in our life. The rush of a business owner, the passion behind the idea you want to execute, and the fire in the belly to make it work at any cost - everything seems like a surreal scene from a blockbuster movie.?

As an aspiring founder or entrepreneur, it is imperative to be nimble, agile and have great communication skills to build your business.?

But there’s more to it than that. It may look easy from the outside, but believe me, it is anything but that.?

When I started Suburban Diagnostics in 1994, it was more of a default decision than one that was thought out. As a Pathologist, starting a lab is very much par for the course. That it worked out well, is another story that I will share separately.?

As an entrepreneur, a founder, or a business owner, there are multiple facets of running a business one must know before taking the leap. In today's age of information overload, being prepared is well begun and maybe the first step towards success.?

While I may have begun very much on gut instinct, if I had to do it again, I would do it better prepared. Because, quoting Colin R. Davis once again, “The road to success and the road to failure are almost exactly the same.”?

This newsletter is an attempt to highlight the steps I would take to start a business today. I touch upon crucial elements that are lessons and key takeaways from my experience, that could be applicable for anyone aspiring to become an entrepreneur.

The main aspects I will touch upon in this edition include:

1. Know your purpose

2. Market gap?

3. Identify trends

4. Co-founder

5. Governance and compliance

6. Technology?

7. Scalability?

8. Peer group?

Know Your Purpose?

For me, anything I do has to start with the “why” - watch the video by Simon Sinek to understand the importance of this.?

Knowing the triggers of why you wish to start a new venture is essential. This purpose will keep you motivated and ensure you persevere when there are tough times. There must be a problem that needs to be solved and have you identified with it.?

I have seen some entrepreneurs, who are not clear of the problem they wish to solve, give up when faced with some headwinds.?

Articulating your purpose and the problem you are solving becomes the starting point for any entrepreneur.?

When I started Suburban Diagnostics, I was clear on few aspects:?

a. Use of technology to deliver the highest quality of reports?

b. Transparency of our operations?

c. Customer centric approach?

With the high quality equipment I had imported from the US, the lab was built as a fully glass structure, giving full visibility to our patients and customers of the actual working of the lab, much like an open kitchen of a restaurant. As a Pathologist, I was always accessible for any interaction with the customers. These steps continue to remain as the bedrock of our operating philosophy.?

Our tagline was “creating higher standards in healthcare” and that is exactly what we tried to do.??

To quote a highly successful example, the purpose of Deepinder Goyal to start Zomato, an Indian restaurant aggregator and food delivery company, was to connect customers with restaurants and delivery partners.?

Prior to 2008, you could not imagine using an application and ordering food at the click of a button. You had to call up different restaurants to place the order and stack their menu cards in your kitchen to build a personal recall. (to think of it - we can’t imagine doing this today.)?

But with the entry of Zomato, they bridged this gap to bring food to your doorstep rather than you going to the restaurant. The mainstay of their business was the ability to pinpoint a problem people are facing and creating a way to solve it.?

As an entrepreneur, that’s the clarity one must aspire to have when defining the purpose of your business. But it is not easy and not everyone becomes a Zomato.?

Market Gap?

When we started Suburban Diagnostics, quality lab services were available largely in hospitals, with few private labs providing the same level of reliability. This was definitely a gap and hence an opportunity. Over time, reports from Suburban Diagnostics became synonymous with the highest quality of laboratory services.?

At the same time, lab testing was performed almost exclusively for illness. I saw an opportunity to introduce the concept of testing for wellness, or as I called it, “testing to remain healthy.” We stuck to this theme, emerging as one of the leading labs focused on preventive health.?

We also realised that operating a lab is a very hyper local operation. Hence, we expanded very gradually and only after we had the resources to do so, ensuring the replicability of systems and processes.?

Knowing the market you operate in and how fast one must expand is another nuance of running a business.?

Even after 30 years, Suburban remains a predominantly western India centric brand, aligning itself with Dr Lal PathLabs for an all India access.?

It is important to know your strengths and weaknesses, and play to your strengths to get the most out of your venture.?

A checklist that could be handy when addressing a market gap:?

a. Market research on the industry?

b. Competitor landscape?

c. Customer profiles and expectations?

d. Service gaps (and opportunities)?

e. Industry trends, margins and P&L?

f. Demand for products and services?

g. Opportunities for growth and expansion - achieving scale?

Identify Trends

It was a line shared by Ronnie Screwvala - If you are able to identify and predict trends, it is far better than mere execution. If you know the trends, it will give you where the industry, or economy, or business is heading. It is a great starting ground for success.?

It is important to leverage digital tools and analytical software's to identify business trends that will give you long term returns. Touchpoints like connected devices, review sites, social media, and online surveys can prove beneficial to provide you with collected datasets that will aid you before starting a business.?

Listening to customers is another way to identify trends.?

When we started Suburban, we kept our ear to the ground by speaking with existing and new customers to know what they want and expect from a diagnostic centre. It was one of the doctors in our network who suggested the need for providing home services - “if the customer can’t come to you, go to the customer.” This proved to be a huge game changer for us, as almost 25% of our business moved to home collections.?

Staying abreast of industry influencers and publications is another effective way of gaining insight into your customers journey and predicting industry trends. We can get immense knowledge, knowing what is being published about our industry, what other brands are doing, and where the industry is headed.?

Co-founder

Many successful businesses have two co-founders. Zomato was started by two people - Deepinder Goyal and Pankaj Chaddah; Microsoft was started by - Bill Gates and Paul Allen; Google was started by - Larry Page and Sergey Brin; Apple was started by - Steve Jobs and Steve Wozniak (but it eventually was led by the former).?

Although there are examples of successful businesses started with a single founder (Elon Musk, Jeff Bezos), most new businesses that I interact with seem to have more than one founder.?

I think it is very important in today’s time to have a complementary co-founder.?

In my case, my wife, Anju, was my co-founder. She brought in complementary skills; I represented the medical side and she focused on the non-medical side. She helped me build the operational and financial aspects of Suburban and I could concentrate on building the testing capabilities.?

It is essential for founders to understand if and why there is a need for a complementary co-founder. This is a topic for debate. Here, the best judgement should come from analysing the nature of your business and then think through whether you would need someone else to complete and complement your skills.?

The key element in having a complementary co-founder must be to have a combined vision to make your startup or business model work. Make this your North Star while deciding to have a co-founder on board.?

With Anju and me, the entire focus lay on one big vision and goal - unburdening healthcare.?

Financial Governance and Compliance?

Every founder must learn to work with numbers.?

I remember the first time someone asked to see my reports; these were not my medical reports, but a monthly MIS, giving visibility of our business performance. I was completely clueless.?

As a new entrepreneur, in the momentum of running sales, marketing, HR and operations, one of the things that is very often missed is recording data, data visibility and data analytics. This forms the bedrock for financial discipline, business performance, financial governance and compliance.?

The discipline in financial governance allows for better decision making. As the title of a book states, “what gets measured gets done.” should be excellent. This builds more transparency across the various functions within the organisation.?

Setting the discipline by having a monthly MIS prepared, analysed and acted upon goes a long way in directing strategic and tactical decisions within the organisation, rather than depending merely on instinct.?

Validating instinct with data is very powerful for any entrepreneur.?

Therefore, it is essential to build:??

a. Strong SOPs (Standard Operating Procedures)?

b. Strong financial governance mechanisms?

Investors see these systems and processes, the way you conduct your business, the way you are with your customers and team, leading them to believe in your business model.?

These systems become the mainstay of the business, enabling the understanding of what direction the business is heading and the ability to replicate and scale.?

Don’t leave this late, make this as important as any other function of the business.?

Technology?

A friend of mine who has worked with technology across all his ventures told me this: “when faced with a problem, throw technology at it rather than throwing people at it.”?

What he meant was to think of technology first. How can we leverage technology to enable a business venture rather than just applying people to it??

By doing this, there is a much higher chance of building better efficiency with a reduced dependence on people - better outcomes at lower costs!?

Scalability?

When starting a business, think of the value it will add to the market in the immediate and in the long run.?

This enables us to think beyond the first 12 months. It allows us to segment the market into existing problems and new ones, and it gives us foresight in building your team.?

Growth and scale are synonymous with value, as much as profitability and efficiency.?

While looking at scale, few things must keep in mind:?

a. Can it be tech enabled??

b. Can we build a skilled team??

c. Do we have the ability to raise capital??

d. Do we have the ability to run professionally - to move from person driven to process driven operations??

As an entrepreneur, I had a long term vision when building Suburban. I did not look at the short term gains but the long term returns. We knew we had a good business model that addressed a market need. But at the same time, we also knew that scaling the business would entail taking risks, raising more funds, and building a diverse team, both technical and non-technical to professionalise our operations. .?

Peer Group?

I think one of the biggest advantages I had when I started Suburban was my peer group. Whether in school, college, or in business - having a strong peer group greatly influences you to think beyond the obvious.?

When I was introduced to the Ascent peer group, it was a game-changer for me and my business. A close knit group started by Harsh Mariwala, where founders from different industries came together and became your trust group, your personal board of directors, your trusted sounding board. The idea stems from the fact that only an entrepreneur can relate to the challenge of another entrepreneur.?

We exchanged ideas, innovative techniques, and leveraged each other's skills to scale our businesses.?

Similarly, there are several entrepreneurial peer groups such as YPO, NASSCOMM, TiE, CII, Entrepreneurs Association of India or Startup Hub India, all of which give you an opportunity to grow.?

They help to -??

a. Challenge your assumptions

b. Broaden your perspectives

c. Establish a trusted support network?

d. Gain better self-awareness?

e. Become a confident leader

f.? Challenge yourself to do better?

In the words of Rod Khleif - ‘Elevate yourself to a peer group of people who’ve achieved success you are seeking… That will supercharge you…’?

To round it up?

Thinking of starting a business is a small step in the entrepreneurial universe.?

The above narratives are not sure shot ways of creating a successful business, but a framework to help you think better when building one.?