Three Lessons For Entrepreneurs
Bhavin Turakhia is an entrepreneur, and founder of Radix, Flock, and co-founder & CEO of Zeta. During his recent visit to Vilnius, one of Europe’s fastest rising tech hotspots, he shared his insights on how to build a successful global business in an event organized by Hostinger and Tesonet.
Rule #1 – Stop Focusing On Valuation And Start Thinking About Value Creation
The valuation of a startup seems to be all that matters nowadays, but behind the glamour of hundreds of billions of dollars, there one but simple truth – business is simply the purchase and sale of goods in an attempt to make profit.
“Almost everyday you can read the news that this company has a valuation of $500M, and that company has reached $10B or even more,” Bhavin continues “Focusing on valuation is not the same as focusing on value creation. Valuation is driven by a lot of proxy metrics – GMV, eyeballs, users – as opposed to metrics for value creation such as NPS, customer satisfaction, revenue, and retention. “The bottom line is this – focus on creating value for your customers, employees and society- high valuation will come with a growing business.”
Rule #2 – Creativity over Cash?
Companies that have massive investment early on tend to throw money at problems rather than creativity and innovation. The world of entrepreneurship rewards genuine innovation that is finely tuned to solve a problem. Relying on your own business savings and startup’s revenue to operate and expand might be out out of the fashion in startup world in 2019, but it is still the most sustainable way to move forward in the long run.
As Bhavin puts it, “you don’t need a strong financial backing to create a successful global business. Back in 1998, I started my career with roughly $350 that I borrowed from my father.”“When you have no outside capital, you don’t have money to waste and that is when creativity blooms. For example, one can start a guerilla marketing campaign instead of spending millions on TV ads.”
Rule #3 – No Matter Where You Come From, Always Build For A Global Market
If taking over the world is on your agenda, then we have good news for you. According to one of the world’s youngest billionaires, in order to be successful, every startup should always build for the international market.
“From the very beginning, all of our businesses were built for the global, not just Indian market. Even though more than 1/7 of world’s population lives here, it was not enough for us. Always think global as there are more clients, more opportunities and more paths to glory in the global market than in any local market.”