Steady Hands On The Tiller

From founding ‘TaxiForSure’ after a drunken conversation with a friend to beating formidable rivals “with less money”, from an overdependence on venture capital funds to an investment of Rs 8 lakh in an online company, which  would ­subsequently be sold for $200 ­million, Aprameya Radhakrishna has had to come a long way in his journey before eventually becoming an angel investor. “And none of my B-School education could have prepared me for any of it,” says Radhakrishna, an alumnus of IIM Ahmedabad.

At a time when an MBA degree is touted as one of the most coveted qualifications in India, and the start-up ecosystem in the country is at its peak, Radhakrishna believes that a B-School education is not what ensures the ­success of a start-up.  

“Of course, there is no denying that is a value addition, but to say it is essential is stretching the argument,” says Hari Menon, co-founder and CEO of ‘Big Basket’, who founded the online ­supermarket along with four others, three of whom were IIM graduates, with the fourth being an alumnus of XIMB. With over 30 years of work experience before founding ‘Big Basket’, Menon ­believes it is experience and what you make of it that counts more. Tushar Vashisht, Founder of ‘HealthifyMe’, India’s leading health and fitness ­application, also emphasises “real world experience”, and the importance of learning quickly from it. And given that most start-ups are now ­technology-driven, founders believe that an engineering degree, or any ­product-based degree, is more ­important than a business one. “A ­business degree teaches you something you can learn on the job. It’s not rocket science,” says T.N. Hari, Head of Human Resources at Big Basket. So far, Big Basket has hired engineers through campus placements, rather than MBAs.

For Radhakrishna, the need to start his own business came from the ­realisation that he was overworking, and not reaping the benefits. “A start-up would ensure that I was not only working for myself, but also seeing direct results of my hard work,” he says. What helped him realise the dream was networking, and that is one thing for which all entrepreneurs give credit to business schools. “Just the cohort of people you come in contact with in B-schools, and the network you build therefrom is extremely significant,” says Mayukh Choudhury, an IIM Lucknow graduate and co-founder of Milaap, the country’s largest crowdfunding ­platform. Vashisht points out that the community of entrepreneurs that you come in contact with in these high-­calibre institutes helps when it comes to founding and building start-ups. “And there is no denying that the struggle is lesser, and doors open for you a lot quicker if you are from a prestigious B-school,” adds Radhakrishna. Many of these start-ups work through internal hiring, as well as hiring based on ­recommendations that come by way of networks. However, it can be argued that any other ­degree from a reputed ­institution can provide one with the same kind of ­opportunities. Vashisht goes on to say that two-year MBAs are almost redundant for people who ­already have networks, and a shorter course would do well enough.

This, however, is not to dismiss B-school education. “One of the key things that a good B-school education gives you is problem-solving ability,” says Menon. “B-schools follow a ­‘case-based approach’, and that helps build the understanding of making ­correct, intimated decisions in every ­situation,” says Choudhury. Seema Kumar, country head, Developer Ecosystem and Startups, adds that it may not be a necessity, but B-Schools offer a 360 ­degree grounding in all things business — finance, sales, ­marketing, operations, the importance of which can hardly be denied.

In fact, all these founders believe in hiring MBAs for running the businesses proficiently. In a market where ­product-based companies are making their mark,  MBAs may not be able to disrupt, innovate, or bring about ­exponential scales, but they do bring in the required stability. “We started looking at tier one B-schools once we began to scale and had a formal, structured setup,” says Radhakrishna. Vashisht ­seconds him, praising the “mature business practices” and “stability” that these professionals bring in. “MBAs don’t have the high risk-taking attitude that is required to beat the system in case of start-ups, but they bring in ­valuable steadiness,” he says. Big Basket’s Menon too says that they are looking at hiring young MBA graduates, although this is still in the planning stage.

As of now, India is the world’s fastest growing start-up ecosystem and ranked the third-best destination for technology investments. The country is home to half-a-dozen start-ups that are valued at above $1 billion, and has at least ­another 50 that have the potential to make the mark. According to an IBM Institute for Business Value (IBV) ­report, more than 76 per cent of ­respondents in a survey of over 1,300 Indian executives—600 start-up ­entrepreneurs, 100 venture capitalists, 100 government leaders, 500 leaders of established ­companies and 22 educational institution leaders—believe that India’s ­economic openness is a major business advantage. Six in ten recognised India’s skilled workforce as an asset for businesses. However, this seems to be contradicted by a finding in the same study that reveals that 90 per cent of start-ups in India fail within five years of founding. In the quarter ending March 2017, the ­volume of initial angel and seed ­investments went down to 120, ­compared to 245 deals in the same ­period in 2016. The reasons for this ­include the fact that these start-ups are susceptible to copying already successful global ideas like the Olas, Flipkarts, and Snapdeals, an over-dependence on investors that results in a funding crunch, a lack of talented mentors and difficulty in finding the right talent .

But institutes are now evolving to ­incorporate the start-up culture in their curricula. “B-school education is not the same now as it was when I ­graduated. Most now have specific ­modules for start-ups, and groups that drive innovation and start-ups. My ­approach would have been very different if I was to join one today,” says Choudhury. Most hope that this will ­address some of the ­inherent ­problems that the Indian start-up ­industry faces, and even make that sought-after MBA degree indispensable.