First Principles The Ken

"This notion of a startup should be centered around the founder is a mindset. It makes for great stories. It makes for great heroes. And that's the reason why that sustains But, you know, there are great organizations that have been built where founders did not believe in that. And the organizations sustain even after the founder leaves."

That's what Alok Mittal, founder and MD of Indifi, an online lending platform, had to say about startups getting caught up in the founder-worshipping trap.

I hope you have heard my first episode with him. I often ask founders if they believe in the concept of a founder-led organization. Or how they're planning for a post-founder future for their organization. Because like Alok, I do believe that just like a parent's role is to eventually step back and let go of their child, so it is for founders.

But that's not easy when we're living in the golden age of founders. Where co-founder tags are coveted much more than CEO titles. It's not easy for many founders to let go. 

But that was just one of the things that Alok and I discussed in our conversation. Alok, if you didn't know already, is involved in a lot of things. His day job might be MD of Indifi, but he is also the founding board member of Indian Angel Network and co-founder of Plaksha University.

Plaksha is a project he has been working on for quite some time and the way it is structured was interesting and something a lot of centers of education should be aiming to build in India as Alok explained:

"The notion of departments that exist in educational institutions is not the right architecture. Especially for a country like India, more and more of technology skills have to get expressed as entrepreneurship for it to be relevant to society. I don't think we have another answer for the jobs we need to create or the growth that we need to build.

Now, you take all of that, and the question that we are asking is, what does that mean for the university system? And so, for example, at Plaksha, there are no departments. There are these integrated centers of research which are oriented towards a particular problem like climate. But there is no computer science department, there is no mechanical engineering department. There is no mechanical engineering major because we don't think that students will need to be experts at mechanical engineering in a silo to be able to build.

So there is a major in autonomous systems, which means robotics, which means drones, which means all of that. But there's a major in biological systems, which means genetic engineering, which means personalized medicine, things of that nature. So that is the new architecture that we are putting in place for how technology education should be done."

If you haven't already checked out the first part of my conversation with Alok Mittal, now would be the perfect time to give it a listen. You'll find in that conversation when and how Alok fell in love with the idea of being an entrepreneur.

Welcome to First Principles—The weekly leadership podcast from The Ken.

Let's get started.

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“As I said, I am from a middle-class family. I was earning $10,000/month, which is a large sum in those days. And sitting in Singapore, Bangkok, travelling around the world. So my the larger question in my mind is that how do I take the decision?” says Manav Garg.
Manav Garg, founder and former CEO of Eka Software, a SaaS company that operates in the global commodities trading space. "Former CEO" because Manav started Eka in 2004 and just sold it earlier this year. 
Since Manav was earning $10K a month back in the early 2000s, we talked about golden handcuffs. You know, when people earn so much that they become risk averse? A lot of people are attracted to the lure of startups but not necessarily the grind that comes with them. Including much, much lower pay. 
“So, my competition was TriplePoint, Openlink, SAP. Large companies, at that time. $100 million plus companies. So, I started calling them. Cold calling. And few of them didn't pick up my phone.

One person luckily picked up my phone saying, ‘Please don't call me again and again. It's not nice. I'm never going to work for Indian company.’
 
I said, ‘Fine. Since I have you on phone, can I meet you?’

He said, ‘No.’

He said, ‘No. What will you do by meeting me?’
 
I said, ‘Let's have coffee. What I will do is, tell me your travel schedule.’
 
He said, ‘I am flying to London tomorrow, so I am going to be very busy.’
 
I said, ‘Okay, let me do one thing. I will travel to London next day and I will meet you at Heathrow. Just have a coffee. You anyway will take a shower.’
 
Most of the people from New York travel to London that red-eye flight, take a shower in the arrival launch. I knew that. I said, ‘I will meet in the arrival launch. Half an hour coffee and then you are free to go.’

He said, ‘Fine.’

Luckily, he said, ‘Fine.’”
 
It takes a LOT of courage to fly to London to meet someone who said he doesn’t want to work for an Indian company. And a LOT of vision to convince that person to join you. That’s what happened at the end of that 30-minute meeting that stretched to 2 hours. 
 
Today, after 20 years as founder, Manav has jumped right back into the ring as the co-founder of venture capital firm TogetherFund, along with Girish Mathrubootham of Freshworks and others. When I asked him about something most potential founders overlooked, his answer was easy: Co-founder selection. 
“See, in India also, still we have in that cultural mix, where you start up with your college friends because you spend time in dorms together, in college, you went through life's ups and downs together, right?
 So, therefore, you're very attuned to start up with your friends from college, most likely, that's the most likely case, or from your workplace. You work with somebody in Amazon, Flipkart, Freshworks, Eka, Zoho, so therefore you end up starting up.
I personally think that there is also a way to manufacture your co-founders.”
 Manav advises founders to set aside at least 6 months to “manufacture” their co-founders by just meeting a LOT of people. 
My conversation with Manav uncovers a lot of insight on how young founders should think about building for the long haul. He did it for 20 years. 
There’s a lot of very counterintuitive builder wisdom to unpack in today’s conversation.
Welcome to First Principles–The weekly leadership podcast from The Ken.
Let’s get started.

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Listen to the first special episode we released on 17th May: “Why aren’t we scared of chemicals in our skincare anymore?”

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Kapil Chopra, the founder and CEO of Postcard Hotels told me the following statistics.
Of the 10 million foreign tourists who visit India each year, roughly 10% - one million - are classified as luxury. 
“So we've kind of made entire Rajasthan and Kerala as two big sectors for one million tourists,” he said.
In comparison domestic trips made by Indians was around 2.3 billion a year, a few years ago. 
Even if just 1% of those could be upgraded to luxury travel, that’s 23 million.
Chopra wants to make that happen with Postcard Hotels, his luxury boutique hotel chain. Launched in 2018 with 3 hotels, it has 9 today, and 23 in the works. 
He wants them all to be in what he calls the “transformational” category. What’s that you ask?
The first level is commodity. A bed, an air conditioner and a bathroom.
The second level represent hotels that offer differentiated “products”.
The third level are the luxury hotels come, differentiated by exceptional service.
The fourth level is experiential. It’s what Airbnb does when it offers you the ability to stay in Paris at a place that overlooks the Eiffel Tower.
The fifth level is for “transformative experiences”.
“When you combine all of them. If you're able to give a good product, great world class service, great experiential experiences, soak in the destination. If you add all of this together, it becomes transformational,” says Chopra.
He lists three luxury hotel brands in the fifth category – Aman Resorts, Six Senses and One & Only.
“And I looked at them and said, what is common?  They were all founder-led. And the founders were amazing. But the founders all lost control of the brands they had built,” he says.
Kapil Chopra doesn’t want to join that group.
Kapil also has strong opinions on why he believes the luxury hotel business has become sterile and unexciting over the years, and how Postcard is changing that image. Apart from Postcard, Kapil Chopra is also the founder of the table reservation service, discovery and payment platform, EazyDiner.

Over the course of our conversation he also talks about:

How luxury travel and travelers are evolving in IndiaWhy did he choose to leave the Oberoi Group at the height of his careerHow he’s become calmer after starting Postcard HotelsHow he’s doing fundraising, investments and expansion in way that doesn’t endanger the parent companyWhy ESOPs and wealth creation needs to be more prevalent in the hospitality and travel industries
Welcome to First Principles–The weekly leadership podcast from The Ken.

Let’s get started.

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If you love listening to First Principles we’re sure you will enjoy reading our Sunday newsletter aptly titled First Principles as well. Sign up here, it’s free.

Also write to us fp@the-ken.com with your feedback, suggestions and guests you would want to see on First Principles.
And if you'd like to listen to the First Principles Summer Playlist you'll find it here!

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Jaydeep Barman has settled into his role of being a CEO for quite some time now. He admits he was not always the nicest of people when they restarted or ‘actually started’ Faasos, which later became Rebel Foods, as a QSR chain in 2011. He would be unreasonable and brash with the people he worked with and in his own words “must have rubbed people the wrong way”.

But with time he has gained perspective, as one does when they go through all those experiences. Now, he’s thankful for all those who remained despite him not being the best boss.
Today Jaydeep believes Rebel has found its way but he resists to rest in this fast changing world even though he stands by one belief: People’s love for good quality food will always be there and till the day that doesn’t change Rebel will be very much in business.

In the first part of our conversation with Jaydeep he recounted the journey of Rebel Foods, a lot of anecdotes about the restaurant industry at large, how he hires people with founder’s mentality and not LinkedIn mentality and a whole lot more…

We strongly recommend listening to the first part of our conversation with Jaydeep to get the full picture or if you wish you could read the full transcript of that conversation here.

In this second part of our conversation too, Jaydeep was full of insights about the internet restaurant empire he has built and how they arrived at its current version not with clear, set ideas but a lot of experimentation and realising what works and what doesn’t on the way.

Jaydeep also touched upon a lot of other things including:
The role his co-founder, Kallol Banerjee plays at RebelHow they arrived at Rebel OS and the possibilities it holdsHow, at Rebel written reports are the norm and not the exceptionWelcome to First Principles–The weekly leadership podcast from The Ken
Let’s get started.
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Additionally, if you love listening to First Principles we’re sure you will enjoy reading our Sunday newsletter aptly titled First Principles as well. It’s the perfect read for a laid back Sunday morning. Every week you’ll see us discussing mental models, insights from disruptive thinkers and founders, photos and book recommendations curated with help of our wonderful First Principles community and even fun playlists. Sign up here, it’s free.

In fact, listen to the Summer Playlist we shared in our latest edition. It’s eclectic, vibe-y and a must listen.

Alok Mittal has been on both ends of the startup ecosystem. He’s been a founder and a VC. These days he’s back in the founder’s seat but still enabling businesses but through his lending platform Indifi which lends money to Small and Medium Enterprises or SMEs.

He has very strong thoughts about org building even though he admits Indifi is only 9 years old. He speaks from his observations and his strong beliefs. In Alok’s mind it’s the mid-management which holds together the organization and not necessarily the leadership team.

Alok also has the history of setting up three ventures, which includes the part he played in setting up Canaan Partners, a VC firm in India. Then of course there is JobsAhead which was his first startup and now he’s busy lending to the sector which contributes to 30% of the country’s GDP, and yet finds credit hard to come by.

Alok hung up his VC shoes in 2015 to solve this problem and take on the problem of lending to SMEs, the ones who were being given a pass by traditional banks and NBFCs. But they’re not leaning on solving for every SME out there. Indifi have found the sectors they want to lend to and are working towards making these businesses get access to credit.

He also talked about:

Failures and the learnings it bringsHow he assesses risks as a VC and a founderThe bible of raising moneyAdvice to Young entrepreneurs
Listen to all of that and a whole lot more in this Part 1 episode of our conversation with Alok Mittal.

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Rebel Foods was incorporated in 2015. Before that it was Faasos and Faasos has been around since 2004. But co-founder and CEO Jaydeep Barman says back in 2004 when he and his co-founder Kallol Banerjee started it, they didn’t look at it as a means of living. It existed to some extent, primarily, to fulfil their own craving for good Calcutta rolls as Pune, where both of them were living at the time, didn't have any nice joints for the same.
A few years after starting it both of them left it behind to go and do their second MBAs from INSEAD and after completing it Jaydeep went on to work for McKinsey in London and Kallol headed to Bosch in Singapore.

But the dream of having their own company brought them back to Pune in 2011 and this time they were serious about making Faasos huge. They wanted to make it a QSR chain in the image of McDonald’s and Dominos of the world, but catering to the Indian taste buds. They raised some venture capital and got a few angel investors and decided to fire up their journey to growing their store numbers and serving great food.
But this journey hit a roadblock when they grew too fast and revenue didn’t match up growth on a per store basis. This is when they had the first of their ‘lightbulb moments or epiphanies’ as Jaydeep calls them.
Infrastructure or setting up a restaurant on the high street was a fixed cost that made it hard for Rebel Foods to scale beyond a point. So they decided to enforce a change in how they do business by taking away this fixed cost component and just investing in making food in a kitchen ideally in a location where rent is low.
This decision was aided by customer insight as well. When they ran a survey nearly 74% customers said they had never been to a Faasos outlet or they had been to it once. So they piloted the cloud kitchen or ghost kitchen concept, which meant you just have a kitchen which fulfils orders and no storefront or dine-in area, in Mumbai and it worked and they haven’t turned back from there.
There were two more lightbulb moments which have made Rebel Foods what it is today. What were those?
Find out that and a lot more in this episode full of a lot of 2x2 matrix examples, possibly one of the most fun brand origin stories, how Rebel Foods became the world’s largest Internet restaurant and priceless insights into the world of serving food without a restaurant that you and I can dine-in.
Welcome to First Principles – The weekly leadership podcast from The Ken.
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