The Entrepreneurial Mindset: Launch and Grow Successful Startups
Welcome back to The Zista Podcast, where we dissect a variety of compelling topics. Today, we turn our focus to the mechanics of launching and growing successful startups. Our guest, Tanul Mishra, CEO of Afthonia Labs, brings her extensive experience to bear, offering insights that span multiple industries and the specialized world of fintech startups.
In today’s episode, you’ll find a wealth of practical strategies and actionable insights, whether you’re in the early stages of business idea validation, navigating the nuances between incubators and accelerators, or fine-tuning a pitch deck for diverse audiences. With questions that resonate across the entrepreneurial spectrum, this conversation aims to equip you with the understanding and tools that are often hard-won in the fast-paced worlds of startups and fundraising.
Welcome back to another episode of The Zista Podcast, where we dissect topics that keep our gears turning. Today we’re zeroing in on the mechanics of launching and growing successful startups. Our guide through this complex landscape is Tanul Mishra, CEO of Afthonia Labs. With her deep-rooted experience across multiple industries, and her current focus on nurturing fintech startups, Tanul brings a multi-faceted perspective to the conversation.
Tanul brings a rich portfolio of experiences with her. She has worked with top-tier brands such as Tata Communications, INOX, Reliance Communications, and Paymate. On her entrepreneurial journey, she founded Eatalish, a unique food service that connects artisan food makers in India with households across the country. Now at Afthonia Labs, she’s dedicated to building a fertile ground for fintech startups to flourish. Her incubator has been a stepping stone for startups like Ginger Root Code Factory, Flashpay, Tickmark, Digi Suvidha, and Phone Pe Loan, among others.
In this episode, we zero in on the crucial questions that many aspiring entrepreneurs have on their minds. From the initial steps of validating your business idea to understanding the nuances between incubators and accelerators, we dig deep. But that’s not all—we also tackle the art of customizing your pitch deck for different audiences, avoiding common mistakes when pitching, and navigating the intricate worlds of competition and regulations.
Whether you’re thinking about dipping your toes into the entrepreneurial pool, scaling an existing venture, or simply curious about the dynamics of startups and fintech, this episode is designed to provide you with actionable insights. You’ll also get a glimpse into the workings of Afthonia Labs and hear about some startups that have particularly caught Tanul’s eye.
So, buckle up for a journey encompassing the art of launching and growing successful startups. Get your notepads ready; we’re about to dive in!
- For businesses that can go directly to the consumer, such as food or retail, starting small with samples can provide a wealth of insights.
- Being a part of entrepreneurial communities can provide you with invaluable mentorship and opportunities.
- Tailor your pitch decks according to the specific audience you are targeting. The same deck won’t appeal to customers, partners, and investors equally.
- Don’t save your most compelling data or facts for the end of the presentation; lead with them to capture attention immediately.
- Customer feedback, both positive and negative, is crucial for product development and refinement.
Q1. What strategies can budding entrepreneurs use to validate their business ideas?
A: Tanul provides a nuanced approach to idea validation for budding entrepreneurs, emphasizing that the right strategy can vary based on the type of business.
For businesses where the product or service can go directly to the market, such as in the food industry as an example, Tanul recommends starting small with samples. Testing the product among friends and family or even in local stores can offer valuable feedback.
Complex and Regulated Industries:
If you’re entering a more complex sector, which might include industries like fintech or space tech that have heavy compliance and regulatory requirements, Tanul suggests becoming part of an incubator or an accelerator.
Benefits of Incubators or Accelerators:
- Access to a wealth of knowledge through a diverse set of mentors.
- Opportunities for networking within the industry.
- Added credibility when pitching your business solution to potential clients or partners.
Networking and Community Involvement:
Tanul also emphasizes the importance of networking by becoming part of startup communities like Startup Grind and Head Start. According to her, the stronger your network, the better your chances of success, summing it up with “the more people you meet and the better network you have, the better your net worth.”
So, whether you’re in a straightforward business that can go directly to market for validation or in a more complex industry requiring specialized support, leveraging available resources effectively can provide the validation and credibility you need.
Q2. What’s the distinction between Incubators and Accelerators for startups?
A: Tanul explains that understanding the difference between incubators and accelerators is akin to the educational progression from nursery to primary classes. Incubators come into play at the very early stages of a startup’s life. Some incubators, like Afthonia, engage with entrepreneurs at the conceptual stage and assist in building the product from the ground up. If a startup already has an early-stage product, incubators can help in scaling it further.
Accelerators, in contrast, come into the picture at a later stage. They are designed to help startups that have already developed a product and achieved some scale. The aim is to accelerate growth and take the business to the next level.
In India, the terms “incubator” and “accelerator” are often used interchangeably, a reflection of the country’s nascent startup ecosystem. Tanul points out that although India ranks high in the number of startups, it lags behind in the number of supporting incubators and accelerators. For example, the U.S. has over 2500 such entities, China has more than 1500, but India has only around 500.
Tanul adds that a significant portion of these incubators in India are either associated with educational institutions or led by the government, with a much smaller number being private and independent. So, while the terminology may vary, especially in India, the essence of the roles that incubators and accelerators play in a startup’s journey is distinct.
Q3. How can entrepreneurs tailor their pitch deck for different investors and audiences?
A: According to Tanul, the first thing to consider when creating a pitch deck is the audience. The pitch you prepare for investors will be distinct from the one for customers or partners. Even among investors, there’s a difference in what a pre-seed investor would look for compared to a pre-series stage investor.
To maintain a balanced pitch, Tanul stresses the importance of having a consistent core message. This core message should revolve around what you’re building, your value proposition, and how it addresses specific needs for different audiences like investors, customers, and partners.
One critical point she emphasizes is to keep the pitch engaging. With the numerous pitches that individuals and businesses receive, it’s vital to capture attention. Some key elements to focus on include:
- A concise one-liner that states what you are building and what problem it solves.
- The market size and the significance of the problem you’re addressing.
- A clear articulation of the solution and why your approach stands out.
- For investor-specific pitches, details about the revenue model are crucial.
Tanul also mentions that regardless of the audience, discussing the team is vital in the early stages. Whether it’s a customer or an investor, they are essentially backing the team. So, highlighting why your team is the right one for the project can make all the difference.
In summary, the key to a successful pitch deck lies in knowing your audience, maintaining a consistent message, keeping the presentation engaging, and focusing on elements like the problem, the solution, the market size, the revenue model, and the team.
Q4. What mistakes should entrepreneurs avoid when presenting their pitch deck?
A: Tanul observes that entrepreneurs often underestimate the short attention span of their audience, emphasizing that you usually have only about five to seven minutes to capture interest. One common mistake she notes is that entrepreneurs often “save the best for last.” For instance, during a Pitchathon presentation, a participant revealed crucial customer data only at the end of the presentation. According to Tanul, if you have a strong value proposition backed by customer engagement or sales, this information should be presented up front to capture immediate attention.
Another pitfall Tanul identifies is a lack of in-depth understanding of the competition. While many entrepreneurs have a broad idea of their competitors, the most effective pitches come from those who have an intimate understanding of how they stack up against the competition. This knowledge not only demonstrates your awareness but also informs how your solution is better or what improvements need to be made.
Moreover, Tanul highlights the importance of having a compelling demo. The phrase “what you see is what you believe” encapsulates why a hands-on demonstration can be so impactful.
Finally, Tanul emphasizes the power of storytelling. She points out that investors and customers are not just investing in a product but also in your vision and journey. Being able to weave an engaging story around your business is often what sets successful pitches apart from the rest. Tanul feels that the art of storytelling is something many founders overlook, but it’s an element she strongly believes should not be underestimated.
In summary, Tanul suggests that entrepreneurs should: 1) Capture attention by leading with strong points, 2) Deeply understand their competition, 3) Include a compelling demo, and 4) Master the art of storytelling to make a memorable impression.
Q5. What strategies can young entrepreneurs use to navigate competition, regulation, and customer feedback?
A: Tanul believes that adaptability and keen awareness are vital for founders when dealing with competition and regulation. She notes that many effective entrepreneurs are constantly “keeping their ears to the ground,” staying abreast of changes in compliance, regulatory shifts, and market trends. By doing so, they are able to prepare and adapt as needed, rather than reacting after the fact.
When it comes to customer feedback, Tanul shares her own experience with her previous venture, Eatleish. She explains that when bringing a product to market, you’re likely to receive a lot of feedback, particularly on aspects like branding and packaging. While it may be challenging to receive criticism due to the emotional investment in the project, she emphasizes the importance of maintaining objectivity. The key is to set aside personal feelings and evaluate whether the feedback has merit. If it does, the next step is figuring out how it can be leveraged for the benefit of the company.
In essence, Tanul advises young entrepreneurs to be adaptable, well-informed about their industry landscape, and objective when dealing with customer feedback. Putting the company’s needs first allows founders to make better decisions that lead to long-term success.
Q6. What should entrepreneurs consider when choosing a co-founder for their startup?
A: Tanul emphasizes the importance of selecting the right co-founder, given that this person will be a significant part of your life and business journey. One of her key recommendations is to seek out a co-founder with a skill set that complements yours, rather than one that mirrors your own. As an illustration, Tanul mentions her experience with her previous venture, Eatleish. While her strengths were in revenue, sales, and business, her co-founder excelled in product development. This diversity of skills enabled them to cover different aspects of the business more effectively.
Another important criterion is finding a co-founder who is not a “yes person.” You want someone who can constructively challenge ideas, ask pertinent questions, and prioritize the interests of the company. This is essential for making well-rounded decisions that have long-term implications for the business and its employees.
Respect between co-founders is also crucial. Only when there is mutual respect can you give and receive feedback effectively, even when it may be difficult to hear. Tanul often shares a test for co-founder compatibility: If you put both co-founders in separate rooms and ask them a fundamental question about the growth of the company, their answers—while possibly phrased differently—should align in essence.
In summary, Tanul advises entrepreneurs to look for co-founders with complementary skills, a questioning attitude, and a high level of mutual respect. These qualities will enable better decision-making and a more successful entrepreneurial journey.
Q7. What mindset do young entrepreneurs need to cultivate for personal and professional success?
A: According to Tanul, cultivating the right mindset is crucial for any young entrepreneur. She starts by emphasizing the importance of ownership. As an entrepreneur, you own every aspect of your venture, both the successes and the failures. This ownership extends to being solution-oriented. Unlike large corporations, startups don’t have abundant resources. Therefore, you’ll often encounter roadblocks and will have to make quick decisions that balance what’s urgent, important, and critical.
However, Tanul also points out a few attributes that are often overlooked but are crucial for success. The first is flexibility. The entrepreneurial journey is full of twists and turns, requiring you to change course frequently. Being rigid won’t get you far; you need to adapt as situations evolve. The second is openness to feedback. No one knows everything, and constructive criticism can offer valuable insights for improvement.
Last but not least, Tanul underscores the necessity of childlike curiosity. In the fast-paced world of entrepreneurship, innovation is key. Maintaining a sense of curiosity can fuel your creativity and keep you ahead in the game. Coupled with resilience to weather the ups and downs, these traits create a balanced mindset that will serve you well both personally and professionally.
Q8. What inspired the creation of Afthonia, and can you share any notable startups that you have incubated?
A: Tanul recounts that the journey leading to the inception of Afthonia began with her corporate experience at Paymate. In those early days of fintech, they were leveraging SMS and IVR technology to enable financial transactions, working on projects ranging from financial inclusion to money transfers. This experience stoked her entrepreneurial aspirations, leading her to co-found Eatleish with Shipra. It was during her time at Eatleish that Tanul observed how many young entrepreneurs lacked access to networks, and knowledge that she had, as a seasoned professional. This realization inspired her to build a platform that offered these entrepreneurs a safe and nurturing space. She officially moved into the incubation sector around 2018 after exiting Eatleish.
The main reason Tanul chose to focus on fintech for Afthonia is because of its vast growth potential coupled with the complexities it presents, such as multiple compliance requirements. Given the diverse financial needs of India’s various demographic segments—from urban to rural populations—Tanul sees fintech as a sector where solutions can be impactful yet nuanced, thereby necessitating a targeted incubation process.
Regarding the startups incubated at Afthonia, Tanul highlights two in particular. The first, Funngro, aims to educate teenagers about growing money, not just saving it. Through a ‘teen-lancer’ program, they connect teenagers with corporates for project-based work. The teens then have the option to invest or grow the money they earn on the platform. Tanul finds this idea compelling as it prepares the next generation to handle money responsibly.
The second startup that caught her attention is Legacy Next. This platform helps individuals prepare for the financial implications of life’s inevitable end. It streamlines the claim process for families by assisting in will creation and financial asset allocation, addressing the often-overlooked yet emotionally taxing aspect of estate planning.
These two startups stand out for Tanul because they address two different spectrums of future-oriented needs: one equips the next generation with financial literacy, while the other prepares families for the logistical and emotional challenges that come with the loss of a loved one.