If I may divide the phases of a venture I would call them – Surviving, Expanding and Sustaining. We are in the surviving phase right now.
There was a long delay between the last post and this. In between we opened our second dialysis center. We also changed our business model a bit which reduces our return but also reduces our risk. In our second center Sparsh took over the operational responsibilities while the marketing responsibilities remained with the hospital. This model is unlike our first center where we just have rented space in a hospital and take over all the responsibilities.
Trying out different models is a necessity while you are growing. Its better to make a mistake now than later. From the small experience that we have gained so far, the most important thing for a startup is the cash cycle. Getting payments from customers (in our case hospital who collect the cash from patients) and making payment adjustments with vendors is most important. The less time you spend in these activities the more you can focus on your core job. Although entrepreneurs initially are skeptical regarding off loading stake for cash, I would suggest its better to have the cash cushion so that you are free to pursue value-added activities. This will help the firm grow faster. One advice which I have heard numerous times and now have started believing in it “100% of 25 is better than 50% of 100″. If you have access to personal cash to fund your venture then nothing like it else offloading stake to get cash helps you to grow.
More on HR issues in the next post.