Wolf in sheep’s clothing in the Startup Ecosystem

I believe we have all heard of the story of the Wolf in Sheep’s Clothing. There are many wolves,  in the startup ecosystem in India. As a person who is a part of the India / Bangalore Startup ecosystem and writes about it a bit, it is time to call them out in the open. Like the saying goes,

Beware of false prophets, which come to you in sheep’s clothing, but inwardly they are ravening wolves

Few months back, I was banned from a startup community group, OCC Bangalore. The reason, I dared to ask the moderator / admin, why they were charging money for generic meets, if  the likes of Google and Yahoo are sponsoring the venue and the snacks. If there was a valid reason in charging money, they could have answered that and made peace. But the fact that they chose to ban me, for asking a legitimate question, made me realize, something is not correct.

This event kind of opened my eyes, and I started exploring deep and understanding some of the players in this ecosystem. Apart from OCC, I probed deep into many other startup groups, forums, and community, including TIE to understand how exactly they are helping improve the ecosystem. I would be mentioning a few names based on my observations. However, it does not mean, only these are bad and others are good. If not anything, I would like you to question their motive, and reason before paying for any startup event. Startups or entrepreneurs most often try to swim against the flow, the least we can expect is a good supportive ecosystem.

It is not about the Rs.150 or Rs.200 fees here. It is the motive and reason behind the fees. There are many events, which charges similar amount, but brings a lot more value to the participants. Calling oneself “Open Coffee Club” and charging money for apparently no reason, is an altogether different matter. It is something similar to giving bribe, paying Rs.100 or Rs.200 to government official, when the motive and reason behind it is, unethical if not illegal.

Yet another similar setup, which seems to be present everywhere is BNI. I sometimes refer to it as the second Amway. They also charge money for connecting different businesses. Most businesses do get value out of BNI, however, it is not meant for startup in general. Like many people support Amway, there are many who support BNI as well. For each post I have done asking for connections, I do end up getting one or two people inviting me to a BNI Chapter meeting. If you want to help me or startups grow, why do you have to ask them to attend a paid event, and join a network. Why can you not connect and help us with connections in your network? Sorry, but networking or connecting two people in your network, should be free and not charged.

Another area where greedy people are trying to make money is Mentoring. Some mentor claim to support in few areas, for a charge. They wont even listen to the idea, and say it is worth pursuing or not, if you have not paid them. Some others claim to help startups scale, ask the right questions, open doors, etc. IMO, you should never ever pay anything upfront to mentors. The best way to find mentors is by reaching out to people, you know have done something similar to you, or a startup building things similar to you. Try to collaborate and see if there is any synergy. Here is a link which gives some clues on how to find a mentor. Work with each other for a few months, and if you see they adding enough value to you, offer them some equity in your startup, and get them on advisory board.

I have been disappointed with TIE Bangalore as well. While they may not qualify as a wolf, they are just too expensive to support a startup ecosystem to blossom. It is not entrepreneur friendly. Hopefully, they change their model and focus more on helping entrepreneurs. Charging membership fees plus taking above Rs.500 for a 2-3 hour meet does not sound helpful. And please do not compare with going to movie and spending Rs.500 on ticket and pop-corn. Entrepreneurs can ill afford doing that. If some entrepreneurs are still doing that, they will realize it sooner or later, the value of this money.

I would also like to call out successful, experienced or failed entrepreneurs to come out in the open and help other startups. You can help other startups sharing your experience and learning, and guiding them thru the paths you have already traveled. Santosh and Mukund are two example of people who are coming out of their comfort zone to help fellow entrepreneurs. I am sure there are many more like them in India, we need them to come out in the open, call out the people doing wrong, and offer help to other entrepreneurs. If you ask a few people I have interacted with, I do offer help, consulting, feedback, suggestions to people open to talk about their product, without any financial expectations. Bangalore Startups is a place when I and a few other entrepreneurs hangout, to help each other and have a healthy debate over stuff.

The ecosystem, or the groups and the communities is good not for the admin/moderator driving it. It is good for the people who take part in the discussions. It is we the members, who give our time and share our knowledge to make a group grow better. By supporting a wrong group or community to grow, we are indirectly, supporting the wrong act. I would earnestly request you to stay away from such groups, communities, and setups, and raise your voices against it. I know there are many who are already protesting by staying away from it, however, if we do not raise our voices, we are not helping the new comers, and those who are not ignorant members.

So, why this post? There are many of us, who feel somethings are not correct, but choose to ignore it thanks to our “chalta hein” attitude. Look to what stage we have got our nation’s politics and administration with this attitude. I certainly do not want a similar fate for the startup ecosystem and community in India. The “chalta hein” attitude does more harm in the long run, than we might imagine. And if we choose not to protest it now, it will be too late when we eventually realize it. So the time to take action is now. The time to come out of yet another comfort zone is now. We are already two steps ahead of others, having stepped out of our comfortable job life, to fight it out in the market. But, we need to do more.

I could have chosen to keep quite and keep my learning and experience to myself. However, as they say, the person who sees wrong and does not protest is, more wrong than the person doing the wrong act. I would be happy, even if 1% of the people reading this, make a conscious effort to help the ecosystem, and help expose and drive away the “wolves in sheep’s clothing”.  I choose to stand against the wrong acts, and I choose to raise my voice against it.

However, my experience has not been only negative during this period. I have found and made friends with a lot of people. There should be more programs like ‘Startup Leadership Program” in India. It not only connects you some of the best minds in the community, it also helps in educating you from all aspects of building a startup. I have met some very good mentors, who have given their valuable time, and advice when I am stuck with something. I have met many startups, who have come out to extend a helping hand in giving working space for free, connecting to individuals and businesses.

So, I would like all the entrepreneurs and startups to question the motive and reason behind the charge. Money is probably the second most important resource we have got, and we need to watch it closely. You have the right to question every single rupee you are giving to someone. And if possible, start keeping a tab on all the money you are spending, and you will be amazed to see how much money you can save for better things, like surviving the tough tough world out there. Thanks for reading my post, and all the best to entrepreneurs and striving entrepreneurs.

Alternate Payment Solution – Idea 1

This is the first in the series on problems and solutions posts, problems faced in a day-to-day life and a probable solution to this.

The primary means of payment in India is cash and coins. Credit cards can be accepted by the unorganized markets and almost 95% of the transactions today, happen in unorganized markets.Is this a problem? Well ask yourself. Would you be more comfortable transacting without any exchange of cash, or with it. Mind it, my no exchange of cash, I do not mean plastic money. I mean an alternate payment solution.

There are primarily two main reason for this. First, the banks do not and can not extend credit card machines to unorganized market. To some of the small stores that they are extending, the charges are very high, and deters a merchant from using it or availing that option. As a result, the transaction falls back to the use of traditional currencies.

Second, not everyone is eligible to get a credit card. And quite honestly, I would not like to see India become a credit card country. We have all seen what has happened in the west with a debt ridden economy. Debit Cards are present, but again the usage for them is limited to the ATM only to a large extent.

So that brings us back to the problem. Is there an alternate payment solution possible? Mobiles?

Yes, mobiles can be the alternate payment solution. And no, I am not looking at the NFC. It will take about 3-4 years to gain mass market share. Rather than be dependent on a device again, (mobile phones in case of NFC) I would rather like to be use the mobile number or the UID as an identity. With the fate of UID still not clear, the balance shifts in favor of the mobile number as identity.

RBI and the NPCI have already laid the platform for this, called as Interbank Mobile Payment Service (IMPS). Using this technology, money can be transferred from one bank account to another, instantly. Almost all the big banks have now enabled this in their system, and it is F.R.E.E.

NgPay has implemented this solution to some extent. As far as I know, they have tied up with HDFC bank for this but it is again not in mass scale.

We need a service provider, who would be implementing this solution across multiple banks. With the platform ready, it will need effort to have tie-up with banks and then implement a service solution to make an app which can work across mobile OS, like jaxtrsms. This does work even without the need for the app, just by the use of SMS. However, a useful and easy to use app will go a long way in driving adoption.

The opportunity in this sector is HUGE. Even without replacing the credit card industry, this solution can go to the grassroot levels. Enable a local kirana store to accept payment. It can even enable a temporary, road side shop to accept payments and have transactions super easy. Think of Square Up for India.

Yes, there will be a lot of concerns, adoption has to be driven, users will have to be educated. But in the long run, this is certainly a solution, which is worth giving a try. It may also, I said may, help in controlling corruption, and black money.

Your comments are welcome.

P.S.: If anyone does decide to take this idea and start working, I would glad to offer my help in any capacity possible.

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