Breakfast + Lunch with Kanwal Rekhi: Learnings & Insights I gained from the grandfather of modern entrepreneurship.

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It is not very often that you get to spend a whole lot of time with iconic entrepreneurs unless you are in a group at a conference or in a working meeting with them- they are always hustling and gunning for the next point. However, there are times when you just get plain lucky.

Lunch with Kanwal Rekhi

Recently TiE Mumbai hosted an exclusive business builder breakfast session with Mr. Kanwal Rekhi- a Serial entrepreneur, iconic investor and the co-Founder of the global TiE Network.  Around 70+ entrepreneurs turned up at 8.15AM in the morning for the 2 hour session. Fortunately for me, Kanwal had a flight to catch a little after lunch, and I , along with three others, volunteered  to ‘hang out’ with him and drop him at the airport.

Simply put, we just got plain lucky to get to spend a few hours over lunch with the 66 year old genius and learn some great insights and get some personal mentoring. These are some golden intangible perks that you gain by volunteering at networks such as TiE.

The good news for you is that I believe in sharing knowledge and have put together some excerpts from our conversation with him. (I am hoping that my perception and understanding has not skewed too far.) Here it goes…

Entrepreneurship and Getting Started:

  • The entrepreneurial gene is randomly distributed, you are not an entrepreneur just because your parents are or not. Many entrepreneurs hail from the defense backgrounds.
  • Only 6% of startups in the USA get funded. Only 2 % of the USA population succeeds as entrepreneurs.
    In India it is 1-2% and in Nigeria, the number is 10%. In Japan, the word ‘entrepreneur’  is almost synonymous with a cheat.
  • You have to give yourself a chance because nobody else will.  I became an entrepreneur because I met somebody I knew and I thought, “Why cant I be one?”
  • There were these lines form the song Juta Hai Japani (that articulated this well) – it’s a very entrepreneurial song:

Nikal Pade Hai Khulli Sadak Par Apna Seena Taane
Manzil Kahan, Kahan Rukna Hai,Uparwala Jaane
Badte Jaayen Hum Sailani, Jaise Ek Dariya Toofani

  • The biggest motivator for a human being is not the reward, it is fear. The fear of getting left behind, not getting in etc. is more motivating. The young kid who sells books on the road knows math much more than the kid who goes to school- he has the fear of losing out in life v/s not scoring the best marks.
  • Keep yourself out of the comfort zone- that’s what entrepreneurship is about.
  • (From several transformations in his life):  If you’re good at what you do you will go up quickly, its like going up the hill. Once you are on top of the hill, the next step is always to come  down. You can sit there and stagnate but if you want to climb up the next hill you have to come down first.
    (FYI: Kanwal went from being an entrepreneur to an angel investor to starting a venture fund and now an active mentor. He transitioned from hardware to software)

Upar-Neeche Neeche-Upar Leher Chale Jeevan Ki
Nadaan Hai Jo Baith Kinare, Pooche Raah Watan Ki
Chalna Jeevan Ki Kahaani, Rukna Maut Ki Nishaani

On ‘Me Too’ Business Models:

  • Indian’s do well because they are brought up as in a competitive society.
  • You can choose to be like gorillas (heavyweights), chimpanzees ( specialist in a particular geographies) or monkeys (who do survive, but on peanuts).
  • For e.g. In the automobiles sector : General Motors (Gorillas), Porsche and Volvo (Chimpanzees- specialists in a particular type) and we know many monkeys around.

Honge Raaje Rajkanwar Hum Bigde Dil Shehzade
Hum Singhasan Par Ja Baithen Jab Jab Karen Iraade
Surat Hai Jaani Pehchani Duniya Walon Ko Hairani

On Being a Mentor, a VC and yet so fit and active at his age:

  • When you work with an entrepreneur, you assume that you can add value to them.  They are sharp and brutal- if you waste their time, they will move on. I am motivated to stay fit because of the fear of being rejected as a guru 🙂
  • There is no formula in entrepreneurship. However, the formula that I use is learn 10x more than I teach.
  • Venture capital is not about business modeling and other MBA analytics- that helps in fully formed and stable business model that works more at the PE business. VCs need to understand  the startup dynamics and be able to empathize with an entrepreneur. This comes either by running an enterprise or working closely with a large number of entrepreneurs.
  • B Plans a re dime a dozen. As a VC, I invest in the person and not the idea. Ideas and plans keep changing in the course of the journey. Key traits that I look in an entrepreneur:
    • Intellectual honesty: be true to yourself while designing the business ideas, concept, projections etc
    • Ability to hold oneself accountable:
      Don’t blame the VP engineering for the product bust or the VC for lack of funding- accept that you couldn’t hire the right person or anticipate the  funding requirement/unable to manage costs.
    • Not in love with the idea:
      Many times you have to let go the idea to build a sustainable enterprise. Entrepreneurs who are hung up on ideas  and averse of adapting are most likely to fail.

    Its easier to survive in India without VC money than in any other place in the world. You have family support system here that funds and mentors you.

On Incubators:

  • Incubators assume that there is a proven model- but there isn’t one. There hasn’t been any major winner emerging out of an incubator yet.
  • The entrepreneur has to evolve in the rough and tumble of the market place. An incubator cushions the entrepreneur.  You need to learn every small decision making, running errands, signing leases – each of these prepares you for the next stage. If you are too dependant on an incubator you cant become a tough hardened entrepreneur. It’s the small decision you make that help and teach you for the long run.
  • Incubation is not totally bad, it’s a hop step- it’s a good place to start once you have quit your job and need a place to start going to, before you find your own.
  • Many new-age mentors and incubator founders are ex employees of some technology giants. People who have not built businesses from scratch, but are mentoring. There is a saying, ” If you are so smart, how come you are not that rich?”
  • In the current incubator-investment circuit : Every deal seems to have the same valuations. There is no differentiation between entrepreneur,  market, technology. Its like Andher nagri, chaupat raja, takke ser bhajji, takke ser khaaja

About TiE, the global entrepreneurial network that he Co-founded:

  • TiE is like a temple where you meet like minded people, draw inspiration, get mentored. It’s not the end but one of the tools.
  • You acquire knowledge and wisdom over a long period. You develop your knowledge and belief by  working with entrepreneurs. At TiE this knowledge gets transferred in a very efficient way. For an entrepreneur, if even his arts improve by 5%  he gets a new perspective of looking at his challenges. That’s the magic of TiE.

Finally, his favorite entrepreneurial song from where the lyrics have been quoted.

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