Young entrepreneurs should evaluate the source of the money they get2 min read . Updated: 28 Dec 2012, 02:48 PM IST
Understanding value will help the entrepreneurs to innovate better and continuously evolve their business
Embedding: We provide services that are need-based and thus have to be customized. We really do not cater to the wants but emphasize on the needs. Wants can be standardized (cell phones, dish washers, etc.) but needs have to be customized (lighting services for a vegetable vendor or a documentary film for an NGO). For one to understand the needs, it is extremely critical that we embed ourselves into the target client base.
To embed means think, sleep and eat like the client. Typical surveys will not be sufficient, as they will never bring out the nuances that lie between the lines. Things get lost in translation or articulation. Expectations are mostly poorly articulated—thus the expertise to extract that has to be built within.
This is why we emphasis that the client (in our case, the poor) has to be a partner and not just a consumer or an end-user. In the end, not only would one have created an appropriate service for the client, the enterprise would have permanently bought the loyalty of the client too—a rare case in businesses nowadays.
Processes and not just numbers: From day one, young entrepreneurs or enterprises have to learn to create appropriate processes for the organization and not just jump on the bandwagon of sales. Learning and creating end-to-end processes will help lay the foundation of the organization—which I personally see many young enterprises faulting on—due to various reasons. For example, it could be simple enthusiasm to show fast growth or buckling under a wrong set of investor expectations.
I would also strongly advise the young entrepreneurs to carefully evaluate the source of money and not take money from anyone just in desperation. This can prove very costly for him or her in the long run. Remember one never hears about investors failing but you would always hear about entrepreneurs failing—so be careful, as it is your reputation at stake.
Technology is not the key: Enterprises that are promoting a new technology have to be very careful. One needs to promote the value rather than the technology itself. Also they need to make sure that the value is actually beneficial and should not just market it because one needs to increase revenues—that is a very short-term strategy and thus unsustainable.
In our case, we do not sell solar systems but we sell lighting services to the poor. We sell four hours of light to the street vendor or two hours of light to the student—we are not selling the solar panel but selling the value. Understanding the value will also help the entrepreneurs to innovate better and continuously evolve their business.
H. Harish Hande is a co-founder of Selco India, which provides renewable energy services to the poor. He was awarded the Ramon Magsaysay Award for 2011.