Evaluating the worth of a start-up: Rohit Khanna

The spirit of the human endeavor is a fascinating thing. It has taken us to the moon and back and now much, much further. But oftentimes, the spirit of human endeavor is confused with ambition. While in itself, ambition is great but to assess the strength of a start-up, it is imperative to look at the intent the ambition of the founders. It doesn’t take much. Just a basic inquiry about why the founders are doing what they are doing gives surprisingly insightful answers.
Often, I have discovered that a lot of entrepreneurs start their ventures because either they want to emulate the success of their peers or the recognition a successful start-up brings or to prove a point. All reasons why any new venture will most likely fail.
A simple but effective measure for both evaluators and founders to understand the sustainability of their endeavor is to understand the Why of the founders in a little more detail. The reasons that drive them to create the solution that they are seeking to create. And the answer that you are looking for lies in a Bukowski poem called, So You Want to Be a Writer? To quote that poem “unless it comes out of your soul like a rocket unless being still would drive you to madness or suicide or murder doesn’t do it.” All other factors in place that is the organization to back.
That is the start-up that has a very high chance of success. The same poem is also a great filter for those starting their ventures as well. The amount of dedication and conviction they would need to make sure their new endeavor is entirely unstoppable.
Now, there is yet another fine distinction to be made here. In no measure does this mean that only those with a path-breaking idea will be successful. The world is filled to the brim with average solutions. In each category, in each sector, at the broadest level of brands, the solutions are more often than not, underwhelming.
Take the example of finance. Even today, some of the largest banks offer at best a clunky, laborious and unintuitive online experience. This left a wide gap for apps such as Groww, ET Money, Multipl, and many more. All this while the banks and old-school financial institutions play catch-up. This truth translates into all bedrock sectors like education, manufacturing, trading of goods and services, and much more. There aren’t yet enough intuitive and, I would go so far as to say basic solutions in most of these categories. Just a back-of-the-napkin number crunching can give you a fair idea.
The education sector. There are nearly 150 million students in India two-three apps at best that are catering to this entire segment. Each of these apps needs a real-world infrastructure of teachers, studios, and much more to be able to serve the category well. Now ask yourself if just two-three players are enough to be able to take on the challenge of 40 million students. This does not even take into account higher studies, entrance exam studies, executive education, and much more.
As a nation, too long have we chased what is trending and what the experts have told us. But that is a misnomer that has given rise to more failed start-ups than we would have otherwise encountered. There is enough scope in the broadest categories to make your mark. Don’t beat yourself up about ‘too many players in the category. As long as your offering is distinct and of great quality, all other factors excluded, there is a much lesser chance of failure than there would be if you were to get into a category with fewer players but less conviction.

It is time to listen to our gut and do what we think we can get emotionally and whole-heartedly invest our time, money, and soul in. That and that alone is the only credible business plan. The rest will always fall in place.