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Is every unicorn a babycorn first?

Is every unicorn a babycorn first?

In the era of easy liquidity, the pop time has been crunched from years to months and no amount of butter (money) seems enough if you can get it.

The distance from an idea to actually running a business is full of extremely rewarding experiences and learnings. The distance from an idea to actually running a business is full of extremely rewarding experiences and learnings.

I owe the title of this article to my friend and much-admired digital media entrepreneur, Shradha Sharma. I asked her a question about her aspirations and goals for her platform, YourStory. 

As she talked about her business goals and life goals, she emphasised that she had taken her time to build her business model in the face of much scepticism and as she thinks of the future, she does not think in terms of being a Unicorn. In fact, she said, "I am a babycorn".   
  
The startup world is new to me. Yes, in my long stint as a banker, regulator, consultant, I have interacted with many startups, founders, venture capitalists, but it is an altogether humbling experience to build a company from scratch. 

Also Read: By 2025, India to Have 200 Unicorns

I learn every day; from my team, my co-founders, potential partners, friends, the internet, social media, media and from our little triumphs and our mistakes. 

The distance from an idea to actually running a business is full of extremely rewarding experiences and learnings. Listening to Shradha affirmed my belief that even amidst the sound of bustling startups, one can retain the conviction in their chosen path. 

I think the imagery of popcorn vs babycorn also stayed with me because it was so visual and somewhat humorous. So, here is some light-hearted thought provocation on the startup ecosystem. For the smiles.   
  
One could argue that any company is a startup up to a certain stage of achieving success or traction. But indeed, this would be false comfort. It may even harm the founders to believe that if they are building a company, they can do just that - build a company.

There are, of course, many examples of companies that do achieve this; building diligently, finding clients along the way and generating revenues to propel them forward. 

Even companies that were created before the term 'startup' began to be applied to new companies aspiring to build and scale a business, were indeed startups, if we were to retrofit the term.   
  
Take the example of HDFC. Someone told me the other day about when HDFC was set up and they wanted to give home loans, they had people sitting on benches outside branches to ask people if they wanted a home loan. 

Curious onlookers asked questions about the loan; how much would they get, would they need to give any guarantee or security, what interest would they have to pay etc. 

Also Read: Livspace fifth unicorn of 2022; raises $180 mn led by KKR

These questions went into creating the home loan product and documentation. Sounds a lot like a startup to me. When we started to work on the idea of having women manage their personal finances independently, we did something quite similar; we spoke to hundreds of women and then we put the questions together in the form of a test so we could understand who our users were and what they wanted.
  
True, some things in entrepreneurship are not hard to understand, regardless of time, space or culture; the desire to identify and solve a problem, find clients, build teams, build products and solutions, scale the business, find revenues, manage costs and regulatory environment, earn profits and pay taxes. 

But some things are indeed not so intuitive. Take, for example, becoming a unicorn. It is not even a useful animal like the mule or the cow. And yet, if you are a startup today, you will aspire to become a unicorn. 

Even people that do not understand what a startup is will be able to tell you why going home is the antithesis of becoming big. And the day you announce you are setting up a startup, your uncle's sister-in-law will call to give you money so that she can be rich when you become a unicorn.   
  
Closer home, your team will wait (im)patiently to become a unicorn. Your HR head possibly has told people about your unicorn timeline even as you are still navigating section XYZ of Companies act and angel tax applicability on the investment you received. 

Of course, your business school friends are already writing you off because it's been eight months since you started and you are not on the list of next year's unicorns yet.  
  
So, when Shradha talked about being a babycorn, I thought it was an apt analogy. Babycorns are not just baby corns. They are whole in themselves. Actually, they are more wholesome and nutritious than their bigger version, corn.   
  
But rule number one of life is to grow up. In reality, if you want to reach a really large market and serve a large segment in a large country, money is what you need to get your product across to people. 

So, money is important to the journey of a startup. But to find a moniker and bracket it within a definition related to a monetary benchmark does seem somewhat limiting. The race to unicorn-ness might put pressure on the most important thing an entrepreneur builds-reputation. 

Reputation in turn comes from culture and diligent attention to detail and passion for service. Much of this is supposed to 'fix' itself once the company becomes big and has enough funding. 

This would be reasonable if money solved all problems. But unfortunately, it does not. And sometimes, well-funded companies are not able to sustain because it is indeed hard to bring culture together if you let it degenerate with an 'ok for now' messaging to your team.   
  
The reverse of this is also true. If a business is starved for money, it is unlikely to survive and therefore even the best product, best service quality or best team culture will die. 

Therefore, good teams and good founders have the responsibility to find money, the gunpowder, the liquidity, the runway, the resource. 

Since we are talking corn, this experience of being small and trying to be useful, but having to attract attention and funding could be compared to being popcorn, bustling and noisy and each getting drowned by the sound of other(s). 

In the era of easy liquidity, the pop time has been crunched from years to months and no amount of butter (money) seems enough if you can get it. All that butter is giving the popcorns extra affection and desirability, but indeed, some will remain un-popped corn and some might escape at high velocity with their perfect shape and taste.   
  
The obligation to make noise seems to have become an integral part of being a startup. You build, but more importantly, you tell the story. 

You don't just do it to repeat to yourself why you are doing it, or to involve your team in the dream and the vision, but you do it to impress. 

To get more butter because, hey, you can never have enough of the damn thing. So much advice you get as a startup founder has to do with fundraising. That it is never too early, that it is never too much.   
At least popcorn is real. Humble or spiked with butter and flavours, it is still the earthy corn that can satiate hunger. Apparently, that is not good enough. 

The most ambitious do not need to care for being useful, but to become a Unicorn, an animal, that if it existed would have been quite useless for the badly placed horn and missing melanin. But as an idea, it is the sexy one.

(Shinjini Kumar is Co-Founder, SALT-@mysaltapp. She writes a weekly column and can be contacted on shinjini@salt.one )

Published on: Feb 16, 2022, 2:52 PM IST
Posted by: Manali, Feb 16, 2022, 2:49 PM IST