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Startups should be VISION Oriented or MONEY Oriented??

Startups should be VISION Oriented or MONEY Oriented??


I had a brainstorming session with my colleagues some days back that being a start-up whether we should be Vision Oriented or Money oriented in approach. It was a difficult question to answer. We do face typical issues which I believe all startups face like managing cash-flow, development of idea, execution of plans, building strategy and off course sustenance. So while facing all that what should be our focus?

During MBA days while studying and also while interacting with VC’s we always get to see the importance of Vision, but recently when I had a talk with many of my friends; I surprisingly found that most of them favoured the money minded orientation for start-ups. While saying that let me clarify that I am considering startups over here as companies/ideas which are not finely established in the market yet. It’s about kinda bootstrapped start-ups.

So, let me start with importance of VISION:

Vision: I would define Vision as an ‘Atom’ of a molecule around which particles (objectives, strategies and execution) revolves. If we look at any big company say Mac-D, TATA’s or Infosys all have their well defined visions.
What do Vision means to bootstrapped start-ups?

I think for most of the founders/starters; Vision is all about an ‘Idea’ on which they try to capitalize and solve some short term problems of the market. There are very few who have a clear long term defined goals or objectives. But for most of the founders the Vision keeps changing with the ongoing experiments depending on the actual market needs or conditions.

I personally think that Vision actually matters and it is far ahead than ‘Idea’. Gone are the days when there was demand for ideas. Now, you go to a VC or an incubator firm. They are flooded with ideas from people around the globe. I believe that they look for an Idea which is fabricated in that long term vision which gives the sustainability to the idea.
Now Question is: How important is the vision for a Startup?

Well, it’s a tricky question. Take an example:

I am starting with a simple idea of preparing burgers; as fast-food market is growing. My vision is ‘Selling Hot Burgers’. Now, say I have started earning heavy profits so that I can focus on Cost, hygiene and other quality stuffs. Now my Vision is modified to ‘Providing cost effective and good quality burgers at hygienic conditions’. Now again my net-profit is growing even more so that I can provide a good ambience with spacious place and nice infrastructure. Again my Vision is improvised to ‘Provide a cost effective quality burger at a great ambience in hygienic conditions’. More I grow better my vision will be.

Now, what if I do not start with the vision of providing ambience or cost effectiveness?? Would it result in failure?? I don’t think so. What do you all say??

Second Question: How important is Money for a Startup?

Watch it on Academic Earth

Well, there is no second thought that money matters. But when I am asking the importance of money, it is comparative to Vision, goals or objectives.

Lets take another example here, I am selling packaged traditional sweets through my own outlets. My mission/objective is to be the biggest player in packaged traditional sweets industry. After a year I realized that the profit margin in packaged sweets is quite lesser as compared to selling it openly. Now, just for sake of more profit margin.. should I switch to over the counter sales of Sweets??
Or say I have started a company with a vision of providing online services to colleges/institutes. What if, I realize that there is a potential in offline services like placement assistance or counseling etc. What would you suggest me to do?? Should I again stick to my Vision or shall I switch??
Now lets get into a start-up debate of ‘Should a Start-up be VISION oriented or Money oriented’?
Since it’s a debatable topic I brainstormed it with few of my friends (Priyesh and Naveen contributed the most :-)). I found that most of my friends (MBA) were supporting the ‘Money Orientation’ for Startups. The reasons were:
  • Founders of startups are not always mature enough to craft a very long term planning or objective. It keeps changing as they grow. Those who grow big can actually craft a Vision and since they are getting a stable earning they can limit the works/act/strategies as per vision.
  • Most of the Startups face the issue of negative cash-flow in early days, so the need of money/earnings grows over the vision.
  • In fight of competing with the existing competitors or to be a differentiator Startups might need to play on margin and profit.
  • Money is the key driving factor to run any business or else limitations may come.
  • Vision makes sense only when startups becomes sustainable.
A solution: again a diplomatic one 🙂

Vision is a broad picture of your objectives which should be accomplished by short-term goals, no matter whether they are money oriented, competition oriented or objective oriented.

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