The program was launched in 2012 by UC in collaboration with the California Institute for Innovation and Development at the Rady School of Management at UC San Diego and the UC San Diego Jacobs School of Engineering.

On being chosen as one of the winners of the competition, the program will receive a $50,000 award from the SBA.

An Incredible Honour

“It is an incredible honour for the mystartupXX program to be chosen for a third time as one of the winners of the SBA award,” said Lada Rasochova, mystartupXX program director. She is executive director of the California Institute for Innovation and Development at the Rady School of Management.

“This award will enable us to further expand the program to include UC San Diego Health Sciences and continue to increase the number of students and alumni we help launch viable startups and positively impact the innovation economy,” she added.

Nurturing Female Entrepreneurs

The mystartupXX program’s mission is to nurture the next generation of female founder and female-led technology startups through mentorship, education and funding.

The program is designed to encourage and aid female students from all across UC San Diego to create innovative, technology-driven companies.

mystartupXX is affiliated with the Institute for the Global Entrepreneur, a new collaboration between the UC San Diego Jacobs School of Engineering and Rady School of Management.

A magnet for Talented Students

“The mystartupXX program has been a magnet for talented students across the UC San Diego campus from undergraduates to postdoctoral scholars to alumni to turn their entrepreneurial ideas into an innovative company,” said Kimberly Davis King, Rady School lecturer and mystartupXX program co-director.

Since its founding, the program has supported four cohorts of female entrepreneurs and 26 female-led teams. Several startup companies have been launched that have raised more than $8 million in funding and have brought several revenue-generating products to the market.

Cypher Genomics, co-founded by 2012 mystartupXX participant Ashley Van Zeeland, was acquired by Human Longevity in 2015. In 2016, mystartupXX company, Clip Diagnostics, won the Life Science track in the UC San Diego E-Challenge competition.

In addition to the SBA grant, the mystartupXX program has been recognized throughout the community for its impact on female entrepreneurs.

The program was recognized with a Pinnacle Award by Athena San Diego for the organization that best personifies Athena San Diego’s mission of fostering the personal and professional growth of women through mentoring, education, recognition and leadership training, thereby enhancing competitiveness and opportunity in the San Diego business community. (Image Courtesy : www.flickr.com)

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However, entrepreneurs should be cautious about getting too many angel investors on board, since apart from losing a large part of equity to them, such a situation may scare off venture capitalists at a later stage, says an article in KelloggInsight blog quoting Scott Baker, assistant professor of finance at Kellogg Business School.

While raising money from angel investors may be easy, VC investment may require a much higher degree of financial discipline. Availability of easy funding may lead many an entrepreneur to splurge on non-essentials.

VCs, on their part, prefer to deal with start-ups that do not have too many angel investors as decision making becomes complicated. “It’s hard to go to a board meeting and discuss voting rights if there are 20–25 different investors, each with a small stake,” Baker says.

While VC firms may charge a fee and expect to own a sizable part of the business, they are better positioned to help accelerate growth. With their expertise, they could help connect the entrepreneur to a vast network and offer guidance.

In the case of angel investors, while most of them would be putting in money and may own stakes, most would not have the expertise or inclination to provide support that the VC firms provide.

Entrepreneurs should also resist the temptation to part with too much equity to angel investors. Fundraising is to be done only when absolutely necessary, Baker says.

He also suggests Bootstrapping as one way to avoid giving up equity. For startups offering a physical product, launching a campaign on a crowdfunding platform allows the business to bankroll itself while demonstrating viability to more serious investors. Baker gives the example of the Oculus Rift, a virtual-reality headset, introduced through a Kickstarter campaign back in 2012. The company is is now owned by Facebook and the product was launched in the market in March.

Another option is an Incubators that not only offer office rentals but also mentorship, networking and resource sharing with companies at similar stages. Startups can take advantage of these opportunities without giving up equity. Some companies working in incubators may also be chosen for accelerator programs, which provide funding to help companies that are close to launch.

Well-known incubators also provide certification. “The good ones can give you a gold seal, which will draw more attention from VCs later on,” Baker says.

Incubators also assist in legal processes, HR sector and even other issues enabling the start-ups to concentrate on its core competency. The temptation to take the maximum amount available should also be resisted.

Instead, the start-up founders should draw up a clear roadmap for growth that would make it easier for them to project to investors that funds are needed for specific requirements.

Disciplined manner of functioning without going overboard with publicity campaigns is also needed. However, there is no one size fit all strategy and changes would be needed according to varied requirements, Baker says. It works out to factors like the industry, type of company and the founder’s level of expertise. (Image Courtesy : www.youtube.com)

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Stuck in a traffic jam, a friend quipped, “One day we will only have e-commerce delivery people on the roads. Some will be delivering to customers but many to each other.” I knew it was just sarcasm but what caught my attention was the way he put it. He was suggesting that while customers see little value in e-commerce, e-commerce companies see a lot of value in each other.

The whole eco-system is self serving instead of being focused on solving customer problems which was really the raison d’etre for this fledgling industry.

What my friend said was not some kind of dark humor – it was a man lamenting in frustration probably remembering the good old days when parking was free and you could walk into a store, exchange greetings with the owner, walk leisurely down the aisles picking stuff that you did not really want and come out all happy.

But e-commerce came and changed everything! Shopping for grocery was a waste of time (I wonder what people do with all those extra hours) and clothes could be ordered and returned some 20 times before you finally fitted in them.

So the men with their fancy degrees decided to take advantage of this unique opportunity of a thriving middle class going online by the millions and said, “We will change the way Indian consumer shops!” 

The party began and everyone started having a great time – the customers were getting amazing discounts and superb service, the investors were watching the value of their investments soar, the entrepreneurs were exiting from one venture to jump to another earning the respectable tag of being serial entrepreneur in the process. But like all good things this too had to end.

Around mid of 2015, the whispers started. The customer who was at the core of this ridiculous game turned out to be smarter than the companies. The moment you took away the opium of discount she woke up and kicked you in the rear. New antics such as mobile only (whose idea was that?), 2-hour delivery, group ordering, freedom sale etc. were tried but no matter what you did the customer made it clear, she wanted all or nothing.

Indian e-commerce was losing its grip and forerunners of online revolution were dying every day. The internet mafia realigned their strategy – territory was defined, new money was pumped in, stakes were bought and sold but the net result – zero, back to square one. Whenever the news of another start up folding up came, people convinced each other that it won’t happen to us.

Finally, Morgan Stanley announced that it was devaluing its 1.5 % stake in Flipkart and the very next day the valuation went down by as much as 30 %. Imagine if Morgan Stanley had written off their investment!

Enough of sentimental analysis, let’s look at some fundamentals as to where it all went wrong so horribly.

1. GMV or Gross Merchandise value – This is at the core of “funding” and measurement of performance in the e-commerce business in India. And it is most seriously flawed. Because unlike the unit economics where every time you sell you are supposed to make money in this case you were loosing it. So what was being measured was in fact how much more appetite you have for making losses or how fast can you “burn” the investors’ money by literally buying the GMV. There is a thing called deal decay and the law of diminishing returns so even if you continue to fund discounts you will not get the same response after a while.

2. Profit vs. Value – You ask the vegetable vendor on the street why he is doing this business and he will tell you in one simple word – Profit. But profit did not appear in the dictionary of Indian start ups. What is that? Let’s talk value. Ok, value to the customer ? No, No, value to the investor. Valuation of the business. Now, while profit makes a business sustainable, valuation does not. It is more of a notion, a false hope which keeps going up and down with the sentiment in the market.

3. Footfalls vs. eyeballs and Customer vs. Shopper – As far as I know the Heisenberg’s uncertainty principle applies only to electrons and not to human beings. But in case of e commerce the same customer existed at the same time in the records of multiple websites. She had several windows open on her laptop and was comparing which site is giving the highest discount. In a real store this is not possible so when you measure footfall they are actual people who are physically present. And because there is a sunk cost they have an obligation to buy something or the other. But an online shopper ‘acquired” at great marketing cost can just close the laptop and walk away.

4. Competition – Ironically, in a quote, Jeff Bezos suggests that one has to be customer focused and not keep looking at the competition. But become a follower and you lose touch with what your customers want. In the musical chairs world of e commerce in India no one was really looking at innovating for the customer or what the customer would perceive as making a difference in their lives. Everyone was following everyone else jumping to offer a bigger discount at the slightest opportunity and they called it competitive strategy!

5. Brand – For those of us who smoke or drink there is no confusion as to what a brand means. As one of my Gurus told me, brand is what a customer is ready to pay above the perceived value of the product or service. Simply put, it stems from a relationship beyond the transaction itself. If the customer is not ‘loyal’ to a brand then it’s a label, not a brand. If you apply these principles to any of the e commerce business most will fall in the label category – just another address that you type on your browser or an app that you have downloaded on your mobile phone among many others (including that of competition). Would you pack five different brands of cigarettes if you smoke Gold Flake when going for an international trip? No way. But in this case, the same customer was not only shopping online from competitive websites but was even using prices comparison tools on others to get the best offer. Ironically, the investor could have invested in all three of them. A classic case of value destruction. Isn’t it?

6. People – Whether its Sam Walton or Ingvar Kamprad or Kishore Biyani -they are business men. More than anything they are passionate about merchandising and retail. This is perhaps the biggest mistake of the Indian e com story. The people who were leading the e com revolution were basically techies and coders. Many of them did not know ABC of product or merchandising. They were financial wizards, seller of ideas and dreams, technology geeks, friends with the VCs. But in the end, they just did not have what it takes. While a retailer at heart like Kishore Biyani stood the test of time, most of the newbies ran away when the going started getting tough. Even those working in the start ups were not dedicated soldiers of a disciplined army. They were mercenaries and bounty hunters moving from one troubled dotcom to the other.

I am sure having invested so much time reading this article you are looking for an ROI on your time spent. I can offer that to you in the form of my take on the whole situation. I firmly believe that the core principles of doing business or living life never change. Only those businesses which have strong fundamentals who strive to solve a problem or bring joy to the consumer will survive.

Within the Indian e commerce space those who have identified a real problem, for example, Bookmyshow.com, which lets you have a confirmed ticket for the movie of your choice at your favourite venue at a price, will thrive. My vote goes to them because they have the required scale and brand value to create a competition barrier. Also, the customer is fine with paying their fee which will make them profitable in a couple of years or even sooner.

The next big idea is not about creating a variant of restaurant delivery service or dropping groceries at home from the Kirana shop. It is about doing this profitably. There must be a “value” trade off between the business and the customer. She should not only be willing to pay you for the product or service, but be ready to recommend you to her family and friends.

The ‘gold rush‘ is over and now the rules of the game will be (re) formed. The online ventures with the might of deepest pocket may stand a chance but in the end it will really be about who has the Queen’s favour. (Image Source: mylinux)

Rajnish Kumar, along with his global team, consults for the biggest Global Fashion Brands on how to use technology. In his free time he can be seen strolling by the Ulsoor lake. He blogs at www.aahang.WordPress.com. He can be reached at rajnishkumar71@gmail.com 

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A majority of the B-schools in the US is witnessing a rise in campus recruitment for full-time positions compared to the same time period last fall, says an Alliance study.

As many as 65% of the respondents reported increased recruitment of full-time MBA students, from 64% last year. The sectors that saw the biggest increases were technology and consulting, apart from specialist Masters programs in Financial Services industry.

Interestingly, the highest increase in recruitments were in schools ranked 21 to 50 and even in those with no rankings at all. Such a situation occurs when the graduates in the top 20 ranks have already been absorbed. While 61% of the top 20 B-Schools reported a rise in recruitments, it was 83% in schools ranked 21-50 and 70% in unranked institutions.

Interestingly, the highest increase in recruitments were in schools ranked 21 to 50 and even in those with no rankings at all. Such a situation occurs when the graduates in the top 20 ranks have already been absorbed. 

Meanwhile, the GMAC, in its ‘2015 Year-End Poll of Employers’ survey found an overwhelming 96% of employers of the opinion that business school graduates created value for their companies and 68% saying that hiring people with MBA and business master’s qualifications was a priority in their company’s hiring plans.

The survey, carried out between October 27 and November 16, by GMAC, tapped 179 recruiters from across 159 companies of varying sizes and industry sectors located in 31 countries or regions worldwide.

GMAC found that more than half (around 56%) of the firms proposed to offer increased base salaries for new recruits in 2016 at or above the rate of inflation. Around 41% said they will stick to 2015 salary levels. About 50% planned to hike average annual base salaries at or above the rate of inflation and 50% to maintain last year’s levels.

BIGGEST INCREASES IN RECRUITING FROM FORTUNE 500 & STARTUPS

Among the recruiters in US campuses were a number of Fortune 500 companies as well as startups, those who have been in business for 12 months or less. While 58% of the schools recorded a rise in Fortune 500 firms recruiting, 48% saw hike in offers from startups.

GMAC found that more than half (around 56%) of the firms proposed to offer increased base salaries for new recruits in 2016 at or above the rate of inflation. Around 41% said they will stick to 2015 salary levels. About 50% planned to hike average annual base salaries at or above the rate of inflation and 50% to maintain last year’s levels.

However, mid-to-smaller sized companies and family-owned firms did not show the same enthusiasm in fresh recruitments. Mid-sized firms, with 100 to 500 employees, were up 38%, while small firms, with less than 100 employees, recorded 31%. For family-owned enterprises, the increase was just 18%.

BAD NEWS: A DECREASE IN U.S. JOB OPPORTUNITIES FOR INTERNATIONALS

On the negative side, job opportunities for international students showed a slight dip that is being attributed to ongoing problems regarding visa restrictions in the US. The increasing enrollment of international students by B-schools at a time when number of work visas remained static could have led to such a situation. Only 19% of the schools reported increase in jobs for non-US students, 36% recorded a fall and the remaining 44% no change.

Schools saw a slight decrease in job opportunities for International students, which could be attributed to the ongoing challenges surrounding visa restrictions in the United States. Hendricks said that the crunch was due to increasing enrollment of international students by business schools at a time when there has been no increase in work visas for them. Some 36% of the schools said job opportunities for non-U.S. students have fallen, while only 19% said they had increased. The remaining 44% reported no change.

JOB OPPORTUNITIES INCREASED FOR FULL-TIME MBAS IRRESPECTIVE OF RANKING

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