Recently, the Indian start-up industry has, for the major part, been riveted by the spectacle of the chief executive officer of one of its most watched start-ups — Housing-.com’s Rahul Yadav — stumble from one controversy to another. The saga which ended with the ouster of Yadav from his post holds several lessons for young entrepreneurs said Ravi Gururaj, chairman of Nasscom Product Council, and cofounder of the India chapter of Harvard Business School Alumni Angels Association.

FIVE – TAKEAWAYSFounder Independence vs Investor Control:

Founders who want 100% control should plan to bootstrap themselves to success. The incoming investor will seek a controlling interest in the decision making, the management team, exit decision and timeline. Those unwilling to live with this should think twice before they take funds from external investors.

Managing Your Board:

The founder must learn to “manage his board” effectively — to provide full visibility at all times to any substantive decisions, data and events. Start-ups live in a VUCA (volatility, uncertainty, complexity and ambiguity) world building consensus among the stakeholders is a critical responsibility of the founder.

They need to learn to orchestrate a board meeting effectively, take time to pre-brief pro-all members to unearth issues ahead of discussions and to avoid surprises at board meetings.

Disagree but do not turn disagreeable:

Great founders are strong willed, they rarely capitulate on their core vision, and they often seek out constructive debate and disagreement to help refine their thinking. All of that can be achieved without turning disagreeable and airing dirty laundry out in public.

Avoid Extreme Founder Dilution:This occurs due to either having too many founders injected into a poor structured initial cap table or by giving away too much equity too early by raising too much money too fast from too many investors. Massive dilution of a founder only encourages irresponsible behaviour as they continue to sink to the point of irrelevance within their cap table.

Talented Engineer does not equate to Effective Leader:Engineering founders are often charismatic personalities. But that does not guarantee they will turn into effective leaders of larger scaled out ventures. Founder should introspect if they truly want to be the general managers or if they are best suited to being the visionary on the larger team. Founders should always act with great business chutzpah but while retaining personal humility.

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Shivani Pandita

Shivani is an avid reader and loves to pen down her thoughts on paper in the most creative ways. She is more on the eccentric side, but it is this obscurity and uniqueness that makes her stand out. She has a passion for photography, travel and music. She strikes a thorough balance between intelligence and creativity and has a solution oriented approach to any problem at hand.

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