Social commerce has been a buzzword right from the time Pinterest showed the revenue potential it holds for retailers through Buyable Pins. 
 
It’s also easy to see why Facebook along with Pinterest have emerged as two largest Social Commerce Platforms accounting for over <a href="http://www.businessinsider.com/facebook-forges-ahead-into-social-commerce-2016-8?IR=T">two-thirds of the total revenues</a> from referrals. 
 
Social commerce allows consumers to purchase with confidence. 
 
 
 
(Image sources: curalate.com / channeladvisor.com) 
 
The fact that social networks provide a platform for driving purchase decisions through word-of-mouth, social proof and influencer marketing, meant brands could effectively tap impulsive shopping desires of users in an extremely cost-effective manner. A case in point being the recent (re)launches of Facebook <a href="https://newsroom.fb.com/news/2016/10/introducing-marketplace-buy-and-sell-with-your-local-community/">Marketplace</a> and <a href="https://www.facebook.com/help/894935210589667">Sale Groups</a>. 
 
Why Social works so well for Retailers 
Retailers need to constantly broadcast and advertise their products to their audience. However, in an over-saturated, highly competitive space, it turns out to be an extremely difficult and an equally expensive proposition. As users on social channels engage, share and sell, brands aim to turn this engagement into revenue. And driving higher engagement can be achieved effectively through social commerce. 
 
 
 
Social commerce platform, Wooplr, makes use of user generated content and curation along with social elements to drive sales for brands 
 
Having <a href="https://techcrunch.com/2015/02/19/wooplr/">built a social commerce platform myself</a>, I can positively say that there are limited alternatives that solve problems around discovery so effectively. Also, influencer-driven and word-of-mouth acquisitions have higher retention rates and repeat purchase frequency compared to other channels. 
 
The Promise of Social Commerce: 
 
Showing the right product, to the right user, at the right time during the discovery process. 
 
Personalisation and curation make this possible. 
The wealth of data built on top of the user’s social graph, which includes purchase history, demographic information, and activity of users, is aggregated by social commerce companies and the resulting data is used to target consumers with a tailored feed of products matching their tastes. 
 
It’s very likely that social commerce companies know as much about their customers’ interests and activities as Facebook or Google. For instance, Pinterest knows if you are getting married or if you are expecting a baby based on what you pin and search for, which makes it all the more relevant for advertisers. 
 
As the market continues to grow, the intelligence made available is enabling conversational commerce. 
 
The Potential of Conversational Commerce 
Mobile messaging applications are more popular and <a href="http://www.businessinsider.com/the-messaging-app-report-2015-11?IR=T">overtook social networks</a> in terms of monthly active users in 2015. 
 
 
 
The popularity of chat platforms over the years meant their utility have gone beyond messaging. 
 
For the next set of internet users coming online, the mobile is likely to be the first screen as most of them will be coming from the developing nations. For these users, chat platforms are likely to feature lower in the pyramid, below social networks and emails as messengers are more familiar and intuitive. Therefore, it makes sense for messaging companies to focus on enabling payments and commerce within the chat interface. 
 
WeChat, is already doing it at scale in China (see image below). 
 
 
 
(Image source: <a href="http://achang.com/blog/wechat-commerce-helps-businesses-connect-with-high-value-leads/">Achang.com</a>) 
 
The Promise of Conversational Commerce 
 
The next generation of internet users and consumers, expect to purchase products and services at all times and in the most convenient way. 
 
Despite the growth of e-commerce, <a href="https://ycharts.com/indicators/ecommerce_sales_as_percent_retail_sales">92% of retail sales</a> still happen offline. 
 
It is quite clear that two-sided conversations help sell better as it is more personal. 
 
Conversational Commerce brings this aspect online, thus increasing the potential for higher conversions. It helps people discover products, identify alternatives, compare and evaluate those choices and finally decide to purchase. As chatbots become better in understanding semantics (given the advances in Natural Language Processing), the experience will become nearly indistinguishable from salesmen interactions. 
 
Google Allo and Facebook Messenger for Business are doing an impressive job already. 
 
 
 
(Image Source: <a href="https://fortunedotcom.files.wordpress.com/2015/03/fb-messenger-business-convo.png">Wordpress.com</a>) 
 
The Road Ahead 
Conversational interfaces are going to become more ubiquitous. It’s important that existing applications adapt to these new trends. 
 
More importantly, the promise of social commerce will be fulfilled to a great extent by conversational commerce. 
 
(Main Image: Flickr)

How the promise of social commerce is being fulfilled by chatbots

A considerably higher percentage of startups are flush with funds today compared to a decade earlier. As a consequence, in the last few years, the market prices for certain type of talent has shot up, mainly fuelled by the whirlwind of VC money made available. 
 
 
 
(Image Source: Dilbert.com) 
 
The machinations of startup finances require them to pay over the odds for top talent. While they are high pressure jobs that require cross-functional skill sets, not unlike other industries, they are also high-risk, as the environment is relatively new, unexplored and extremely competitive. 
 
Undeniably, salaries contribute massively to the burn-rate of startups, especially at unicorns. Often, wages were the single biggest expense items at a startup. At one point it appeared as though the unicorns were trying to outspend each other in enticing the best talent from top B-schools and the valley, but more as an ostentatious show of strength rather than out of requirement or necessity. It reminds you of those pubs that have a scoreboard announcing which table spent the most on alcohol. Needless to say, there has been plenty of debate on when the bubble would burst. 
 
The problem with too much money and overpaying key personnel is that you start operating in a separate market altogether. 
 
That means expensive hires could turn out to be expensive mistakes too, when exorbitant severance packages are factored in. Also, there aren’t many corporates willing to pay unicorn-level startup wages, even for above-average talent which results in them getting locked-in at the startup. 
 
All of this (combined with other macro factors) hastened the fund crunch, leading to lay-offs and a <a href="http://economictimes.indiatimes.com/small-biz/startups/funding-freeze-puts-startup-hiring-in-cold-storage-up-to-50-drop-in-recruitment/articleshow/57240893.cms">50% drop in recruitment</a> in the last 18 months. 
 
Using High Wages as a Strategy 
Ashish Sinha, in his <a href="https://www.nextbigwhat.com/indian-startups-foreign-competition-297/">critical post</a> against protectionism mentions how “excessive funding” shaped the thinking of a “startup founder’s hiring mantra”, which was to give 
 
…so much salary to employees that the salary becomes an exit-barrier. 
 
He goes onto mention that, several startups “had to shut shop because they couldn’t afford to bring in great talent, thanks to the talent-hoarding war by the likes of Flipkart and Ola.” 
 
It can be supposed that, 
 
Such practices created an environment where it appeared as if there existed two markets, one for unicorns and another for the rest. 
 
 
 
(<a href="http://www.tnhh.net/assets/posts-images/throw_money_at_it.jpg">Image Source</a>) 
 
In a way, when growth is the focus and the pace set is extremely ambitious and aggressive, there are few options left other than ‘throwing money at the problem’. So, the <a href="http://www.livemint.com/Companies/55bKNDKYIn4YFlBVuuxitL/Startups-pay-top-dollar-for-Silicon-Valley-talent.html">best talent was lured in at a considerable premium</a> which further skews the wage index heavily. 
 
But paying extremely high salaries comes with its cons besides increasing cash-burn. A recent Bloomberg report mentions how some Google self-driving car experts were <a href="https://www.bloomberg.com/news/articles/2017-02-13/one-reason-staffers-quit-google-s-car-project-the-company-paid-them-so-much">overpaid so much that they quit</a>. Back here, there’s been a spate of exits at the highest levels at <a href="http://www.livemint.com/Companies/LgBrTHVqAM6MBeCAhdDIVJ/Flipkarts-new-CEO-has-his-work-cut-out-in-the-wake-of-topl.html">various</a> <a href="http://economictimes.indiatimes.com/news/company/corporate-trends/top-executives-from-flipkart-snapdeal-ola-and-paytm-quit-companies-to-start-own-ventures/articleshow/51901907.cms">unicorns</a>. While the reasons vary, they have been largely attributed to lack of innovation and work culture in the latter case. 
 
When M&amp;As become the primary strategy for top talent acquisition-When unicorns can’t get the talent they desire, they ‘acqui-hire’ 
Usually an effective strategy to on board entrepreneurial talent who have a high risk appetite, it turns out to be quite expensive too (especially if the buy-out is an all-cash deal). Many a time, post acquisition, the founders lose motivation and may not align completely with the acquirer’s vision. Sometimes, it could turn out to be bad cultural fit for both organisations. 
 
An interesting case was when Flipkart <a href="http://www.livemint.com/Companies/DbMTb2tDKuZoTfEa203XBL/Flipkart-acquires-UPIbased-payments-startup-PhonePe.html">hired back their ex-employees</a> by acquiring the startup they had just founded for a rumoured $20 million. The acquisition was done so quickly, that the founders were yet to launch their product after having quit. It does make one wonder why they weren’t given the freedom to develop that product while they were still employed. 
 
But the playing field is more level now than ever before 
The sheer quantum of dollars flowing in and number of deals happening has resulted in the Indian startup system becoming a more level playing field in reality. 
 
Everyone has reasonable spending power and there is only so much top talent the unicorns can hire. 
 
And the absolute elite talent from the valley, could not be lured in to make that extra difference. That meant, other funded startups could attract local talent, albeit above market prices. 
 
Issues due to wage disparity 
Another problem is that while the top management is paid top dollar, it does not filter down the pyramid at the entry-level or mid-level roles. It is becoming increasingly common for employees to have that <a href="http://www.huffingtonpost.in/2016/08/22/justifying-recent-layoffs-flipkarts-sachin-bansal-claims-he-wa/">odd spat with the management</a> and sometimes even <a href="http://www.thehindu.com/business/Industry/sacked-tinyowl-employees-confine-founder-for-48-hours/article7850903.ece">openly revolt against the founders</a>. But, that is expected when there’s uncertainty over future funding and/or revenue sources. 
 
The recent <a href="https://m.yourstory.com/2017/02/the-infosys-severance-drama/">Infosys episode</a> on high severance packages is a clear example of the old guard trying to uphold core values and maintain transparency as the current management team has adopted a growth-at-all-costs approach which has upset the founders who built their success on frugality and efficiency. 
 
N R Narayana Murthy felt his “compassionate capitalism” philosophy was under threat, which recommends that the ratio between highest compensation in the firm and the median salary should ideally between 50% to 60%. The salary hikes and severance packages, NRN claimed, affected employee morale and increased dissatisfaction. 
 
Regulate Wages? 
Does bringing in regulations on salaries make sense? I don’t think so. We operate in a free market and market dynamics should always dictate wages. That is key for a performance based economy to flourish. 
 
However, to create companies that last at least a couple of decades, firms could insert clauses in the company’s charter that impose reasonable restrictions on salaries. 
 
So what then is the solution? 
Focusing on the fundamentals of building a company and never losing sight of it as the firm grows, is key. That means, getting the work culture right, building lean teams, reducing redundancy and increasing efficiency are critical for success. 
 
But more importantly, it always starts with <a href="https://www.linkedin.com/pulse/8-steps-hiring-right-your-startup-praveen-rajaretnam">choosing the right candidates</a>. 
 
Share your thoughts with me on <a href="https://twitter.com/prajaret">Twitter</a>. 
 
Read: <a href="https://www.linkedin.com/pulse/8-steps-hiring-right-your-startup-praveen-rajaretnam">8 Steps to Hiring Right at Startups</a> 
 
(Main Image: Thinkstock)

Here’s how the startup hiring scene has changed in the unicorn era

A fortnight ago, Elon Musk promised to address a major problem faced by many Tesla owners. <a href="http://www.wsj.com/articles/tesla-owners-frustrated-by-recharge-waits-1435690694">Long lines</a> at Supercharger stations — Tesla’s free and publicly accessible fast rechargers. 
 
<blockquote class="twitter-tweet" data-lang="en">
	
		<a href="https://twitter.com/loic">@loic</a> You're right, this is becoming an issue. Supercharger spots are meant for charging, not parking. Will take action.
	— Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/807787096727425024">December 11, 2016</a></blockquote>
 
The issue has been a major source of frustration for many owners of Tesla’s electric vehicles as the supercharging stations were increasingly being misused as parking spots thus denying other vehicles which needed to charge up. 
 
Sure enough, 6 days later, Musk implemented a solution he thinks will bring an end to the problem and “increase Supercharger availability”. 
 
It wouldn’t. But, more on that in a bit. 
 
Musk’s Solution 
A $0.40 per minute ‘idle’ fee (or $24 per hour). The fine starts as soon as the charging session is complete and the owner is simultaneously notified via the Tesla mobile app. However, should the owner move the vehicle within a 5 minute grace period, the charges are waived off. 
 
Musk also went on to clarify that this idle fee would apply only if majority of the Supercharger bays at a location are occupied. In the event, the Supercharging station were to be largely empty, the owner would not be fined at all and is free to use it as a parking spot. 
 
<blockquote class="twitter-tweet" data-conversation="none" data-lang="en">
	
		<a href="https://twitter.com/TeslaMotors">@TeslaMotors</a> We are going to modify this so that people only pay a fee if most bays are occupied. If the site is basically deserted, no problem to park.
	— Elon Musk (@elonmusk) <a href="https://twitter.com/elonmusk/status/810135528783937537">December 17, 2016</a></blockquote>
 
Why imposing a “Parking Fine” is a Bad Idea 
The construct of this scheme is such that this new parking fine will not have the desired effect in certain scenarios. In fact, it will achieve the opposite of what was intended in those settings. 
 
Musk’s solution will invariably increase misuse instead of motivating the erring Tesla owners to make the ethical decision of moving their vehicles once their cars have juiced up. Also, the resulting negative consequences would be almost impossible to reverse due to what is known as the Cobra Effect. 
 
The Cobra Effect is a type of perverse incentive. It is a phenomenon that occurs when an attempted solution to a problem actually makes the problem worse (I’ve written in detail about how the Cobra Effect has irreversibly <a href="https://medium.com/@Prajaret/the-cobra-effect-in-indias-e-commerce-startups-f6ff1c08dcce#.333gxvcdh">affected the e-commerce space</a> in India and cited more examples <a href="https://m.yourstory.com/2016/09/cobra-effect-indian-e-commerce-startups">here</a>). 
 
Consider the scenarios mentioned <a href="http://www.wsj.com/articles/tesla-owners-frustrated-by-recharge-waits-1435690694">here</a>, where Tesla owners go shopping while their cars got charged. These could further evolve into situations wherein owners seek parking spaces in order to run errands or grab a bite. In the case of the latter, if there is a Supercharger station in the vicinity, it becomes an attractive option. This is especially true in places such as Hong Kong, (which is one of the <a href="http://insideevs.com/huge-queues-at-teslas-most-utilized-supercharger-station-hong-kong/">busiest Supercharging locations</a> worldwide) where owners leave their Tesla for charging during lunchtime — only to create a pile-up of more Teslas that might be waiting in actual need of charging. 
 
And this is precisely why parking fines have been introduced to discourage such behaviour as per Musk. 
 
A question of economics? 
However, Tesla owners will think of the penalty imposed as a price rather than a fine. They would turn what was originally an ethical issue into a simple question of economics at locations and situations that demand it. 
 
Is $24 for an extended hour of parking better than a parking ticket that usually ranges north of $50 in metros such as <a href="http://www1.nyc.gov/site/finance/vehicles/services-violation-codes.page">NY</a>, <a href="https://www.boston.gov/departments/parking-clerk/parking-ticket-fines-and-codes">Boston</a> or <a href="http://www.scmp.com/news/hong-kong/law-crime/article/2048353/more-4200-drivers-day-get-parking-ticket-hong-kong">HK</a>? Also parking at an illegal spot could run the risk of their car being towed away (not to mention the charges at the impound). 
 
Another way people will look at this would be, 
 
Does a $24 fee for a possible 125 mins of parking time justified for an important business lunch with your client? 
 
It sure is! Most Tesla owners shell upwards of $75,000 to purchase Tesla’s electric vehicles, and $24 must be chump change for them. 
 
Legitimising a wrong 
The more important point being, the offending owners are now given ‘permission’ to use the Supercharging bays as parking spots for a price. Thus, by introducing the parking fine, Musk has essentially compounded the parking menace problem and turned it into a (permitted) service. 
 
Continuing with the parking fine is extremely ill-advised as once the owners lose their guilt (of using Supercharger bays as parking spaces), repelling the idle fee would be useless as the owners have already been wired to think that it’s okay to do it. 
 
With over <a href="http://www.hybridcars.com/tesla-model-s-is-second-plug-in-car-to-cross-150000-sales-milestone/">150,000 Tesla cars</a> sold and close to <a href="https://www.tesla.com/supercharger">4,900 Superchargers</a> worldwide, it works out to 1 supercharger for every 31 Teslas on road. A reasonable number. However, once the Model S rolls out, this ratio is only going to get worse further aggravating the problem. 
 
The Plea 
It’s clear that Musk heeds to feedback as evident from the introduction of the ‘idle fee’ in response to a tweet. 
 
So, if you are reading this Elon, I’ve already tweeted out to you urging you to reconsider the decision before it’s too late. 
 
<blockquote class="twitter-tweet" data-lang="en">
	
		<a href="https://twitter.com/elonmusk">@elonmusk</a> Introducing the "idle fee" is not recommended. It'll only increase misuse (parking) - a classic case of <a href="https://twitter.com/hashtag/CobraEffect?src=hash">#CobraEffect</a> <a href="https://twitter.com/TeslaMotors">@TeslaMotors</a>
	— Praveen Rajaretnam (@Prajaret) <a href="https://twitter.com/Prajaret/status/811932976292327424">December 22, 2016</a></blockquote>

Why Elon Musk’s Decision to Impose a ‘Parking Fine’ is a Terrible Idea

How do VCs answer the question-“Should I invest in this Startup?” 
 
Before I get to that, I’ll quickly digress to share the story of a remarkable sporting achievement that gave more impetus to a hitherto, underused method for evaluation of startups. 
 
Back in 2002, the Oakland Athletics baseball team created history by finishing first in their division. 
 
No mean feat, especially when you are an underdog, with severe financial limitations and having lost 3 of your best players to the elite teams. And then to top it all, going on to set an American League record for the longest win streak with 20 consecutive wins. 
 
More interestingly, the way in which the Oakland A’s achieved all of this was so incredible and unique at the same time, that it inspired a <a href="http://www.amazon.in/Moneyball-Art-Winning-Unfair-Game/dp/0393324818">book</a> (which went on to become a bestseller) and a Hollywood <a href="http://www.imdb.com/title/tt1210166/">movie</a> starring Brad Pitt that received 6 Academy Award nominations including one for Best Picture. The movie’s screenplay, was written by no less than Aaron Sorkin (of The Social Network and Steve Jobs fame). 
 
The book details how Billy Beane, Oakland Athletics’ General Manager, and the brain behind what came to be known as the ‘Moneyball’ strategy catapulted them to unprecedented success with 4 more division crowns. 
 
Moneyball in a nutshell 
In sports, the Moneyball model is about finding undervalued (or under-the-radar) players and buying them on the cheap to put together a competitive team. 
 
It gets you the maximum bang for your buck using data and detailed analysis to identify value, which your non-moneyball competitors are yet to spot. They do this by measuring in-game activity of players to make cost-effective purchase decisions through comparison and heavy use of statistics. 
 
It has been used extensively in baseball, basketball and football, with remarkable success. 
 
Moneyball and Consensus 
In his recent article titled, <a href="http://www.businessinsider.in/The-Selection-Dilemma/articleshow/55028022.cms">The Selection Dilemma</a>, Kae Capital’s Shubhankar Bhattacharya, talks about Indian skipper, MS Dhoni, getting selected into national team despite non-consensus amongst selectors (such scenes play out quite often in the movie Moneyball as well). 
 
In the context of Dhoni’s selection, it could be argued that it might not have been entirely, an emotional decision. Perhaps, those selectors who pushed his case for inclusion were playing Moneyball in their heads. 
 
Let me elaborate… 
 
Although conventional wisdom suggests relying on batting averages or runs scored to determine who the better batsmen is, the Moneyball approach would not consider it to be an effective metric at all. Depending on the format of the game (test/ ODI/ T20), it would consider other, more effective metrics, given the team’s requirement or objective for a particular position. In this case, that happened to align with the stated reason by then captain Sourav Ganguly for Dhoni’s inclusion over fellow wicketkeeper-batman, Dinesh Karthik (who had scored more runs than Dhoni in domestic matches that season). 
 
Ganguly mentioned that he needed a batsmen who could perform under pressure on a bigger stage. In Moneyball terms, that probably maps to higher strike rate, runs scored and partnerships stands specifically in the slog/ death overs or while batting second in internationals. Did Dhoni’s stats better Karthik’s in that regard? Unfortunately, I do not have the data. But, his inclusion was justified when he consistently finished tight games for the national side, filling in a precise requirement. 
 
The Game VCs play – Selection or Moneyball? 
Coming back to the article, Shubhankar, goes on to elaborate on how the job of a VC is akin to that of the selector, in identifying promising startups that have been overlooked or misunderstood and hence passed on by other investors. He further illustrates via a 2x2 matrix on how the most successful bets come from non-consensus investments that are not necessarily backed by data or even common sense. 
 
But, if data can really provide actionable decisions, then why do VCs still largely rely on their ‘gut feeling’ or go by their ‘instinct’ before investing? 
 
The Moneyball Dilemma 
That’s because you cannot solely rely on statistics to tell you everything about a startup. Some things cannot be measured statistically or accurately — like a founder’s grit, or for that matter, the craziness of an idea! 
 
Just like sometimes, the only way a coach/ manager/ selector can assess certain qualities of a player, is to watch him/her play, VCs like to assess founders too, over several months and many meetings before they take a bet. 
 
Data scientists, however, would argue that everything can be measured — if you can see it and discriminate it based on those values, a stat can be made for it. According to them, a stat being unavailable only means that the stat doesn’t exist, yet! 
 
They might have a point. 
 
Given the massive advances in machine learning, the Moneyball approach can not only throw data points, but also help find the narrative in that data and its impact (there’s already <a href="http://www.theaivc.com/">AIVC</a> — the world’s first Venture Capital fund powered entirely by Artificial Intelligence). 
 
Coming back to the first question… 
How does a VC answer the question, “Should I invest in this Startup” 
 
I believe the answer will always be a mix of the emotional and the rational. 
 
The emotional ‘Yes’ or ‘No’ determines the faith the VC has in the team and the idea; and the rational will always be a percentage that goes something like, 
 
“There’s a 72.8% chance that the startup will attract follow-on funding” 
 
or 
 
“a 48.2% probability that this startup gets acquired” 
 
or 
 
“a 12.9% chance this startup will list publicly in the next 8 years.” 
 
The latter, in fact, is based more on the evaluation of business models and traction gained. And in that, it aligns with those startups in the [Successful + Consensus] quadrant, which will almost always give less than ideal or maximum returns. The reason is because investors make a beeline to invest in those companies that seem to have everything going right. Thus providing diminishing returns as their value is driven up. 
 
Having said that, investors and founders alike, need to move towards an increasingly advanced set of statistics and make it a bigger part of public discussion when it comes to determining performance of startups. That would mean the media would need to play an active role in the process by not glorifying vanity metrics such as GMV or number of app downloads or number of items sold. A case in point being the recent <a href="http://qz.com/274278/the-real-reason-why-indias-shopping-websites-are-at-each-others-throats-this-week/">war</a> <a href="http://www.livemint.com/Companies/BhnTNmAinnOChvZLwMe86M/Indias-ecommerce-war.html">of</a> <a href="http://www.indiatimes.com/news/india/now-flipkart-and-amazon-fight-over-no-1-spot-in-terms-of-diwali-sales-264705.html">words</a> between the CEOs of Flipkart and Amazon India over Dussera and Diwali sales figures. 
 
Such efforts can also help reign in valuation bubbles. Overvaluing and over-investing, in startups or business models, that are fundamentally broken or flawed, can be thus controlled when the industry moves towards a ‘gold standard' for evaluation via metrics. 
 
Also, such complex metrics would also help overcome the conundrum posed by <a href="http://www.businessdictionary.com/definition/Goodharts-law.html">Goodhart’s Law</a>, as these metrics will be hard to game. 
 
Final thoughts 
In the end, both approaches try to find value where it is not immediately apparent. However, many questions remain to be answered as one system cannot completely replace the other. To choose one, would be ill-advised and plain foolish. 
 
Perhaps, if VCs can evaluate their bets in retrospect and share the data, it could merit a follow-up article. If you had like to reach out in that regard (or even otherwise), I’m on <a href="https://twitter.com/prajaret">Twitter</a> and <a href="https://www.linkedin.com/in/praveenrajaretnam">LinkedIn</a>.

Playing Moneyball with Startups — the Metrics Dilemma

1. THE RIGHT ATTITUDE 
There are two kinds of people who you can hire, 
 
Those who want to push the train, 
 
And those who want to jump into a moving train. 
 
Just as people love to <a href="http://www.bbc.com/sport/football/35988673">root for the underdogs</a> in sports, pick the ones for your team who believe they can beat the ones with more funding. They are ones who join for the idea and the experience rather than the designation. They will stick through thick and thin, they will relish challenges and bring forth the passion, every day of the week. At the end of the day, the candidate you pick needs to believe in the vision, and not the money behind it. 
 
2. PASSION OVER SKILLS 
It’s critical your first employees have the right mentality and the right desire. Skills do matter, most definitely. But, unlike skill sets, passion and purpose are two things that can’t be bought. 
 
3. WORK CULTURE 
It’s the culture you define that helps you hire the very best. The work environment will need to be intense with lean teams working on full throttle all the time. An attitude of “all or nothing” should surround the group — a sense of urgency; the hunger of wanting to succeed. Right from the concept to early growth stages, the environment will be mix of chaos and high energy. And your new hires will need to fit in to this environment. 
 
4. DEVELOP LEADERS 
If you can hire proven leaders, great! Else, it’s critical to develop them. 
 
However, also remember that, 
 
“Power without responsibility is madness. Just as responsibility without power is useless.” 
 
So, it’s imperative that your ‘homegrown’ leaders learn to exercise their powers constructively. That requires a certain level of maturity which is usually gained through experience. They would need a lot of guidance. Be sure to provide it. These are good reasons to be extremely cautious when closing the leadership positions in your company. 
 
5. BUDGET HIRES 
Start by looking for candidates who fit your budget and make the best of it. There’s no point trying to sign a Lionel Messi, when your team is playing in the second division. 
 
Perhaps, you have the budget. But then, everyone wants to pick from that elite pool. And if you decide to swim in that pool, you will soon realize that it’s quite small and too competitive. 
 
So, look for candidates with the right mentality while recognizing their potential. Eventually, your company can then develop that potential and turn it into useful skills. 
 
6. KEEP ATTRITION LOW 
As much as it’s important to hire the right people and develop their skills, it’s equally important to keep them together. 
 
There has rarely been a successful team where attrition has been high – be it in the corporate world or in startups. For instance, most championship winning teams in sports usually have a squad that has been together long enough, have bonded together and put in consistent performances, before winning those trophies. Therefore, it’s crucial that at least the key members of a team stick together. It’s important to create an environment where there’s a feel-good factor in the group. The team needs to be strong enough and critically, patient enough, to become successful. 
 
7. BUILD LEAN TEAMS 
Lean teams are a must for a startup. Such setups flourish because there’s hardly any bench-time, fewer uninspiring tasks and more responsibility thrust upon members. 
 
But, lack of redundancy can be a weakness too. So, it’s important that a few members know not only their roles but also how to cover for each other, because that gives confidence and flexibility. 
 
Simply put, hire the equivalents of <a href="https://www.quora.com/What-does-the-term-full-stack-programmer-mean">full-stack developers</a> across departments. 
 
8. STICK BY YOUR DECISIONS 
Hiring mistakes will still happen. As the leader, once you’ve convinced yourself of a decision you have to take it. And sometimes it might not be what people want to hear. If it means someone has to be let go, then so be it. 
 
It’s hard. So, before you take a call, you can and should get inputs from all the relevant people, but, in the end, when you take your decision, you have to make it alone. 
 
However, it doesn’t hurt to be the nice guy until you can’t be the nice guy anymore. 
 
CLOSING THOUGHTS 
These points are broadly applicable for seed and early growth stage startups. As a company grows beyond that stage, the Peter Principle invariably takes over. It states that, 
 
“In a hierarchy, individuals tend to rise to their level of incompetence.” 
 
But, in the end, the success of your startup come down to your leadership. When you leave a meeting room, the atmosphere should not be worse than when you entered it. 
 
If you are the leader who takes responsibility and whose infectious enthusiasm motivates the team, all the while remaining humble and aware of your <a href="https://www.youtube.com/watch?v=L03vBkOKTrc">days of oblivion</a>, you should have built a positive culture, a cohesive team and hopefully a kickass company! 
 
(Image Credits: Thinkstock)

8 Steps to Hiring Right for Your Startup

Food tech startups, just like those fun breakfast cereals for kids, come in different shapes. From online restaurants to restaurant delivery partners, food tech in India seems to be defined as any technology that helps satiate hunger. In fact, it remained a buzzword throughout 2015, attracting over $463 million in investments across 50 deals. 
 
Unfortunately, things took a dramatic turn early this year. Many startups found themselves starving — for funds. They couldn’t get seconds. 
The all-you-can-eat-buffet got over a little early and the founders found themselves in a pickle. Quite unpalatable indeed. 
 
But what happened? 
For the investors, it was a fad diet — one that showed results in the short term, but caused much harm(shutdowns, lay-offs and distress sales) in the long run with unhealthy and unbalanced habits. 
 
In retrospect, it wasn’t all that surprising. In the fad diet phase, the recommended daily allowances of investment and valuations were based on fishy business models and research data, smudged beneath globs of ketchup. 
 
Many food tech startups were focused exclusively on tackling different challenges in the supply chain (minus the production). The most important part of the experience— food, and food quality, was never the focus. 
 
Companies didn’t realize that packaging, logistics, delivery and customer acquisition count for nothing if the quality of food is found to be lacking. That it was far more important to own the entire experience. 
 
Is there a Secret Sauce? 
Virtual restaurants will need to build out the logistics network to win in the long run, because they can understand eating preferences better, optimize logistics and reduce delivery times. The problem is the high capital costs. But that also presents a massive opportunity for startups that blur the line between freshly cooked meals and packaged foods, using a subscription model to reduce their barriers to entry in this highly competitive market. 
 
What’s Cooking Now? 
There’s a new crop of startups focusing on food production, and whose offerings are based on cutting edge studies by some real smart cookies (aka top scientists &amp; university researchers) backed by business models that Pepsico would have been proud to call their own. 
 
This year is seeing quite a few innovative core food tech companies mushrooming with healthy valuations in the US — the likes of Impossible Foods, Soylent, Nootrobox and Chapul are whetting our appetite and leaving investors craving for more. 
 
Perhaps food tech is back on the menu for many VCs. And why not? Who wouldn’t want a piece of a $40 billion pie? There is a considerable market for health foods and food services and it is growing fast. Plus, the nutritional content of these new age food startups is quite high and investors are happy to put their money where their mouth is. 
 
 
Some food for thought… 
People want to lead healthier lives, and are actively prioritising their well-being. People also know their onions when it comes to fitness — thanks to an explosion of information on the web, coupled with countless fitness apps/devices to egg them on. This trend is definitely not a fad. Indeed we are witnessing a cultural shift. And it’s there for the taking. 
 
However, although people are more aware, it doesn’t necessarily mean that they are more active. People look for shortcuts. Meaning they want to exercise smarter (workout for smaller duration and expect the same benefits) or when they don’t exercise, to not feel guilty about the calorie intake. Food tech can address both use cases and plenty more. 
 
Proof of the pudding is in the eating! 
There are a few core food tech companies in India in this space — mostly limited to fitness bars with the exception of SupermealX — which claim to be a solution (quite literally!) to help you stop skipping breakfasts, address hunger pangs healthily, and avoid empty calories. 
 
The problem with fitness bars and Soylent-type solutions is that it’s a crowded market, and it’s difficult to stand out. That model needs a constant push to delight customers with newness (flavours) and improved technologies. And liquid diets might not be everyone’s — you &amp; I — cup of tea. 
 
Here’s another use case. Hardcore meat-eaters who want to go on a vegan diet but are looking for high-protein substitutes. For these folks, there is a need for an engineered product that sounds like, “Wait, a plant-based food bar that has the texture and flavor of chicken/ pork/ beef and is environmentally friendly?”, that makes them go, “Shut up and take my money!”. That solution will also work for the 29% vegetarian population in the country, who can finally know what meat tastes like and also end all the fuss. 
 
And then there is 3D printed food and vertical farming technologies that come under food tech, but is relatively unexplored in India. 
Whatever the use case, the time is right to spice things up in food tech! But the recipe for success will always remain the same — providing quality food, coupled with amazing service and a superlative experience. 
 
Nom nom. 
 
 
(Image: Indiatimes)

Food tech is back on the Menu for VCs

Copy plays the most important role in communication— more than even design. It can have a major influence on the outcome — be it an ad for a pair of socks, or a headline for a press release, or an election. 
 
After all, it’s the slogan that does the selling. The words persuade the voters as much as the person, and sometimes, more. 
 
This post explores how Trump’s slogan stood out and got the voters to side him in the election. 
 
The Slogans 
 
 
 
The respective campaign slogans of the Democratic and Republican party nominees were, 
1. Stronger Together —  Hillary Clinton 
2. Make America Great Again — Donald Trump 
 
First Impression 
When you say “Make America Great Again”, you are telling people to take control. It tells them that they have lost something that they need to get back. People like to feel empowered and the slogan urges them to take action—that is to vote for Trump. It’s an active statement. It is a powerful statement. 
 
“Stronger together”, on the other hand, sounds rather quite passive. On hearing the slogan for the first time, <a href="https://www.washingtonpost.com/blogs/plum-line/wp/2016/05/23/what-hillary-clintons-latest-slogan-were-stronger-together-really-says-about-her-candidacy/">Washington Post remarked</a>, 
Your first impulse might be to say, “‘Stronger Together’? That’s weak.” 
 
It emotes indifference in the ears of someone hearing it the first time, 
Stronger Together. 
OK... Sure, whatever. 
 
Stronger Together. 
Who cares? Say that to Brexit voters. 
 
Stronger Together. 
Screw you… I hate &lt;insert race, religion, minorities...&gt;. I hate them all. 
 
Consistency 
Hillary’s campaign had 3 other slogans in the run up to her securing the democratic nomination. 
 
 
 
1. Hillary for America 
2. Fighting for us 
3. I’m With Her 
 
None of these slogans stuck. In fact, her team struggled to settle on a slogan for the longest period. It wasn’t until the last week of May, she finalised upon ‘Stronger Together’ as her campaign slogan. 
 
Contrast this with Trump’s campaign, which just had one slogan for the entirety of the campaign — right from the start of the primaries. It was this potent, unchanging and single-minded messaging that helped build his campaign and brand. 
 
Just a few weeks before Election Day, Hillary’s campaign even adopted Michelle Obama’s famous line, “When they go low, we go high” and started marketing it heavily as a campaign chant. Unfortunately, it didn’t appeal much to the already disillusioned masses. In fact, some might even say it achieved the exact opposite. It suggests that if they didn’t vote for Hillary, they were as ‘trashy’ as Trump. 
 
Who knows, perhaps, that line could have worked better if it had been Michelle Obama running for President! 
 
Bottomline, consistency matters. 
 
Brand recall 
It is not that surprising at all that people seemed to have a far higher recall of Trump’s slogan than Clinton’s. In fact, it was the republican candidate’s most visible element in the entire campaign, and he made sure people saw it. 
 
 
 
At every event, interview, media interaction and debate, Trump took the opportunity to reiterate that one line over and over again. We saw more posters, more photographs and more merchandise carrying that line in the media than the Clinton campaign managed. Trump wore caps bearing the slogan to his conventions and gatherings. I don’t ever remember seeing Hillary do that. Not once. 
 
Failure to Learn from Obama’s Campaigns 
 
 
 
The incumbent won the presidency in 2008 against impossible odds with a campaign powered by a single word, ‘Hope’. It created a powerful, new brand that led to <a href="http://www.prwatch.org/spin/2008/11/7926/advertisers-elect-obama-marketer-year-2008">Advertising Age</a>, calling him “Marketer of the Year” in 2008. He edged out Apple, Zappos and Nike for that recognition. His slogans, ‘Hope’, ‘Change’, and ‘Progress’ were all vague, yet inviting. They had appeal. 
 
4 years on, he did it again under more difficult circumstances with the economy showing signs of recovery after the recession. 
 
 
 
Think about Obama’s 2012 campaign again, and his campaign slogan — Yes, we can — another active statement. It spoke directly to voters. It connected with them. It gave Obama the opportunity to promote his brand further to an audience that was readily willing to listen to what he had to say. And it worked. 
 
It would seem as though none of these learnings were taken into consideration by the Clinton team before coming up with the slogan even though she lost the primary to Obama in 2008. 
 
Effectiveness in Creating Long-lasting Bonds 
Even though, Donald Trump made several disagreeable comments (and some outright deplorable statements), people were willing to ignore them. 
 
His slogan communicated that he can address their questions, fears and needs. That enabled him to start building lasting bonds with his core supporters. In turn, that helped convert his biggest admirers into evangelists, which further increased his brand awareness and diversified his base. 
 
 
 
Perhaps Trump’s slogan, ‘Make America Great Again’, is inaccurate. But then, as political analysts noted, people want to hear what they subconsciously believe, even if it isn’t necessarily the truth. And many people think with their heart more than with their heads. They wanted change, not continuity, which is what Donald Trump’s slogan promised. Trump’s slogan effectively baited them. 
 
At first glance, Hillary’s slogan too, has the ability to build relationships, but in a passive tone. It sounds more like, “We are all in this together”. Unfortunately for her, people weren’t ready to buy that. They saw her as part of the institution that was responsible for the mess they found themselves in. It simply didn’t click. 
 
Attacking Trump’s Campaign Slogan 
Hillary Clinton, in one of her <a href="http://www.politico.com/blogs/2016-dem-primary-live-updates-and-results/2016/02/hillary-clinton-donald-trump-slogan-219908">campaign speeches</a>, said that America “never stopped being great”. That only distanced her further from the already angry voters and made them even bitter — most of whom were white, blue-collar workers and made up the bulk of the electorate. They had lost their jobs or were living in fear of losing their jobs to immigrants (specifically Indians, Chinese and Mexicans) or seeing them outsourced to those countries. Thus, making them more anti-establishment. Essentially, Hillary’s statement was seen as her mocking them. 
 
 
 
In fact, in opposing Trump’s slogan, we could many parallels to the failed “India Shining” campaign by the BJP-led NDA in the 2004 general elections. It only connected to those who were successful and bought into the bright future that was being portrayed when the ground reality was quite different. 
 
The Verdict 
There are indeed other reasons why Trump won the election. But, the slogan used by the two presidential candidates mattered and affected the electorate at a deeper, more subconscious level. 
 
Trump’s slogan brought out all the strong emotions — it was engaging, direct and empathetic. It gave the motivated voters something to root for, and worked brilliantly as a simple, powerful one liner that fed off their insecurities. 
 
Most importantly, it not only resonated with the disenchanted masses, but also compelled them to take action. It checks all the boxes for what constitutes a great copy. 
 
 
 
Hillary’s slogan, on the other hand, though clever, wasn’t good enough, and definitely didn’t suit her campaign ideals. 
 
Incidentally, Bernie Sanders’ campaign slogans hit the mark – although he too, had one too many including ‘A Future to Believe In’, ‘A Political Revolution is Coming’ and ‘Enough is Enough’. In fact, a <a href="http://www.independent.co.uk/news/world/americas/us-elections/bernie-sanders-beaten-donald-trump-pre-election-poll-a7412636.html">pre-election poll</a> suggests that Bernie Sanders would have defeated Trump. 
 
Bernie 2020 is likely and it would be wise to stick to learn from past mistakes. 
 
(Image Sources: Tumblr, Frontline, Wikimedia, CNN, Masters Of Media, Cloudinary)

Praveen Rajaretnam

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