Being an entrepreneur is challenging, tough and difficult but at the same time exciting. You no longer get the much awaited SMS – RS xxxxxx has been credited in your yyyyyy account towards salary. You don’t have the luxury of enough balance in your bank account. You start maintaining a monthly household budget and expenditure. It is very difficult for your family to lower the standard of living if required. You can no longer indulge in shopping therapy as a stress buster. In the beginning, you wonder whether it was the right decision or should you go back to the comforts of a corporate job. The thought continues to worry you and sometimes even your family forces you to rethink your decision. You face questions like- How long do we have to compromise? How long do we have to manage with a shoestring budget? And so on. You do go back to job sites to test the job market and see if there are suitable jobs posted for you.
I am sure each one of you reading this post must have heard or read similar rants from the entrepreneurs. The question is: Why then people chose to become entrepreneurs? What keeps them going? What is the secret of becoming successful entrepreneurs?
Honestly, I don’t have the answers to the above questions. Yet, I can narrate my experience in the last 100 days as an entrepreneur. First, you take a bold step towards entrepreneurship with the confidence that you will get decent assignments based on your past experience and the work that you have done. Yet, getting clients and assignments is not at all easy. Trust me, selling your skills, knowledge and experience is one of the most difficult tasks particularly when you are selling a concept and not a product.
So before you begin this journey you must learn business development, you must learn to sell, you should have no shyness in meeting people and asking for assignments. The key here is continuous networking, meeting people and increase your networking. Honestly, I am not very good at it but I have no choice but to shed my shyness and do everything that is necessary to get clients and assignments.
Once you get an assignment don’t compare it with what you have done in the past as a corporate leader. You must service the client and the servicing has to be top notch. It’s simple, if you do a great job, the client will become your mouth piece and refer you in his social and professional circles. Hence, ensure that the client servicing is of absolutely the best quality.
While servicing clients don’t assume that your job is done after you have made the right recommendations. Execution is the key here. You have to take charge and ensure that all the recommendations are implemented. Execution, execution and execution is the mantra.
Some of my experiences and learnings while meeting and servicing clients
- Create the right back end/ support system for all enabling functions like HR, Finance, Supply Chain, IT, etc. If you can’t afford to hire, outsource. If you can’t afford to outsource due to cashflow constraints, offer something in kind.
- Have the right MIS reports to enable business performance reviews. Ensure that you have robust business performance reviews every month. Have stretched but achievable targets to maintain the drive and motivation in the organization.
- Have a weekly/monthly/quarterly cashflow forecast. This helps you to manage your cashflows to a great extent. This also helps you to take decisions around when and how to fund the business. Lack of proper cashflow forecasts could lead to irrational decisions of downsizing the business, losing critical resources, losing clients and ultimately closure of the business
- There is no harm in diluting a small equity to keep the cogs of the wheel running. However, a note of caution here – don’t dilute too much in the beginning as it becomes more difficult to get investors later and at good valuations.
- The promoter / co-founders have to focus on the business and drive sales. If they believe that they can focus on all functions like HR, Finance, IT etc., they will lose the plot. Promoters have to be out in the market focussing on business development and sales.
- It is critical to ensure that business entity is complying with all statutory regulations. The cost of non-compliance is high and it could erode valuations.
- Invest in revenue generating assets and resources. Don’t waste you precious cash on non-core spends like a lavish office, vehicles etc.
- Valuation of businesses today are no longer based on just revenue or number of users or number of subscribers etc. It is critical for every business to focus on positive cash flows and profits.
So guys, we are here to help you grow your business and create shareholder value. Focus on your business and leave the rest to Flipcarbon.
Deepak Kewalramani, CFO Principal Consultant
A result oriented finance professional with 25 years of solid experience in commercial and general management, including 16 plus years as a finance leader. In depth FMCG, food & beverages, retail, engineering & construction and petrochemicals experience with expertise in business partnering, business turnaround, P & L ownership, strategic and financial planning, new business development, business acquisition & integration, ERP implementation, change management, turnaround & shared services implementation.