ENTREPRENEUR SPECIAL.. LESSONS FROM A SERIAL ENTREPRENEUR … Manish Sabharwal

LESSONS FROM A SERIAL ENTREPRENEUR … Manish Sabharwal

Good judgment comes from experience & experience comes from bad judgment. So, don’t be afraid to make mistakes as you embark on your journey

Entrepreneurs Create Two Kinds of Ventures—a Baby or a Dwarf. And The Difference is Not More Money
An unforgettable scene from Arms and the Man by GB Shaw has veteran Swiss mercenary Captain Bluntschli saying, “You can always tell an old soldier by the inside of his rucksack. The young ones carry cartridges; the old ones, grub”. Basically, he echoed the old adage that good judgment comes from experience and experience comes from bad judgment. The opportunity to create a new venture after having done one before is a chance to do things differently. Looking back at our two adventures—our first one, India Life, had revenues of Rs 50 crore after five years while our second one, TeamLease, reached Rs 500 crore—we have learnt that all entrepreneurs make the conscious or unconscious choice of creating two different kinds of companies: a baby or dwarf. Both are small, but one is going to stay small and the other is just getting started on growth. The difference between a baby and a dwarf is not more food—more money—but in DNA. Obviously, a key difference between India Life and TeamLease was luck and better timing. There are five differences between our two ventures that made the difference to scale:
Spot the Opportunity
If you want to scale, make sure you pick a space with huge upside. India Life focused on HR outsourcing, which was an interesting opportunity, but TeamLease is trying to fix India’s people supply chain—a massive problem with huge complexity. It is what the recent book Idea Factory called a “Wicked Problem”, a problem that needs an inter-disciplinary solution and lots of time and resources. Hard work and smarts are always important, but there is hardly any upside in putting lipstick on a pig. So pick a wicked problem. And even better if you can pick a problem that matters to society.
Pick the Right Team
Steven Spielberg says that directing a movie is 90% casting. This is no different from entrepreneurship, where a key task is kissing many frogs to find your princess. Since we had done our frog kissing in India Life, TeamLease has people with different skill sets who balance the poetry (ideas) and plumbing (execution). Also, this time we have planned for a transition in early stage roles: convert a high-energy startup into a structured institution too early and you take away its birthright but too late and you take away its destiny. Essentially, we learnt that people matter more than money.
Colour of Money
Most entrepreneurs obsess about money but few realise that the colour of money is more important the quantum of money. Finding an investor who understands that a company is not a spreadsheet and building one is hypothesis testing—you can’t prove anything right but have to prove it wrong. We took institutional money when we were a piece of paper at India Life; we waited six years before doing that in TeamLease. This meant we chose our investors as much as they chose us.
Organisation Structure
Better organisational metabolism—faster and more effective decision-making—comes from clear roles and responsibilities, forums for conflict resolutions and a leadership team comfortable with making trade-offs. The ‘everybody-does-everything’ chaos of India Life was replaced by a much clearer organisation structure at TeamLease with regular and formal forums to resolve conflicts and make trade-offs. We have not got everything right, but TeamLease is a better place to work than India Life and this enabled us to attract the ‘adult supervision’ so important to scaling.
Balance Ambition & Risk
The biggest difference between India Life and TeamLease has been our appetite for risk. We are young enough to think about the next 20 years but old enough to have the credibility of having created a venture. We focus on winning rather than trying not to lose. We are frugal with capital because we know that entrepreneurship is the art of staying alive long enough to get lucky. But we also understand that entrepreneurship is a leap into the unknown so if you are going to jump from the 10th floor you might as well jump from the 50th floor! What is happing in India today is not once in a decade or once in a millennium but once in the lifetime of a country. This offers unique entrepreneurial opportunities. TeamLease is obviously a child of lower hiring standards. But it is also a child of India Life; an experience that made us wiser, older and therefore more dangerous. But more importantly, it freed and enabled us to make different but bigger mistakes.

Manish Sabharwal
(Sabharwal writes on behalf of his many co-founders)
CURRENT DESIGNATION
Chairman, TeamLease Services
FIRMS FOUNDED
TeamLease and India Life
ONE THING I’D DO DIFFERENTLY
Hire senior people earlier
MOST EXCITING SPACE TO BE IN
3Es (Employment, Employability and Education)

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