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Learn from your mistakes. Even better, learn from others’ mistakes. This is an oft-repeated piece of advice to startups, but it’s easier said than done. We don’t easily accept our mistakes to be able to learn from them. Nor do we find it easy to talk about them for others’ benefit.

This is especially true in a society like India, where failure isn’t worn proudly like a badge as it is in a more mature startup ecosystem like that of Silicon Valley. Last year, Failcon, a San Francisco origin conference aimed at sharing experiences of failures, got a lukewarm reception in India.

Perceptions make all the difference. If a failed founder is seen as being the stronger and wiser for it, he would happily talk about it. But if failure is seen as a sign of weakness, then it prompts reticence.

2015 is a watershed year for India, with over US$8 billion of venture capital funding expected before the year’s out – 50 percent higher than last year. This rush to invest in the newest El Dorado of tech startups has created its fair share of irrational exuberance, as half-baked business models and a plethora of copycats have got VC backing with scant attention to ground realities.

Nassim Nicholas Taleb wrote in Fooled by Randomness about how decision-makers get misled because failures are masked. This is compounded by startup founders being surrounded by yes-men who do not give honest feedback for fear of being seen as negative influences. The media contributes to this distorted reality by constantly celebrating successes and ignoring failures.

But, as the following 11 examples illustrate, there’s as much to be learned from a failure as from a success. However, beware of being “fooled by randomness.” As Taleb cautions us, there are several factors or even plain luck that we often don’t take into account when we attribute reasons for a success or failure.

Dazo

Photo Credit: Ewan Munro

Golden investors and bona fide founder certification still couldn’t save this one. The Google India MD, the Amazon India country manager, the FreeCharge CEO, and the founders of CommonFloor, TaxiForSure, and Yo China were all investors in this food startup. Its founder, Shashank Kumar Singhal, was the mobile product head for India’s first bus ticketing site RedBus, who had qualified from the prestigious Indian School of Business. His co-founder Monica Rastogi was equally qualified. And yet, it had to shut down in October within a year of launching.

The startup began as an internet kitchen with its own chefs and reliable partners serving a few localities in Bangalore. But soon the pressure to scale up made it pivot into an aggregator of restaurants as it focused on the tech at the cusp of food and logistics. This made it dependent, however, on many restaurant partners whose food quality and delivery efficiency were beyond its control. The curation of content it promised at the outset began to take a beating. It changed its name from TapCibo (because many new consumers didn’t get “cibo” is Italian for food), but neither the new name Dazo nor the cool tech it had developed could prevent its slide.

A number of other food startups like TinyOwl, Swiggy, and Zomato have run into problems this year, but are trying to ride it out with a longer runway they have in funding.

Spoonjoy, Langhar, OrderSnack

Photo credit: femme run

These are three other food delivery startups that were short-lived. Spoonjoy, like Dazo, had an impressive roster of investors including Flipkart founder Sachin Bansal. This food tech company got follow-up funding of US$1 million from Saif Partners. But it could not sustain operations and scaled back last month before being acquired by grocery delivery startup Grofers, whose founder Albinder Dhindsa made it clear that it was an acqui-hire and Grofers had no intention to diversify into the food delivery business.

As urban India sees a mushrooming of nuclear, double-income families, as well as a large influx of young singles with busy work schedules, there’s clearly a big opportunity for food ecommerce. But this has led to a rush to fund food startups as investors get the “fear of missing out” syndrome. Not enough attention has gone into the cash burn and quality problems on the ground. Now, many of the startups are finding it hard to raise later stage funding and floundering.

Langhar, a Delhi-based service for freshly cooked meals, shut down earlier this year, and Chennai-based OrderSnack closed after failing to raise funds. Eatlo, Freshmenu, and Frsh are others reported to be in a desperate hunt for funding and may be the next to bite the dust. We can expect more failures before fundamental issues in execution are sorted out in this space.

DoneByNone

Photo credit: Art Comments

Ecommerce is a tough nut to crack. Startups which have been surviving so far in the game are just the heavily funded ones, notorious for burning investor money and reporting huge losses.

Gurgaon-based web-only women’s fashion brand DoneByNone was backed by early-stage venture capital firm Seedfund, which invested US$2 million in it. DoneByNone had three founders – Amarinder Dhaliwal, Vijesh Sharma, and Vijay Misra – with tons of experience in ecommerce, internet businesses, and technology. Dhaliwal and Sharma were earlier with Bennett, Coleman & Co., and Misra was a former director of the TCNS Clothing Company. They launched the company first as Handspick in February 2011, and a year later, rebranded it as DoneByNone.

But it ran into trouble soon. “We’re a small start-up, and as you can imagine, life has been quite tough for small ecommerce retailers – and we went to hell and hopefully are on our way back from there. While we were focusing on other things that needed solving, we took our eyes off you and your issues. We’ll now work to sort each and every issue you all have. If we’ve taken an order and haven’t fulfilled it, or have messed up while fulfilling it, we’ll work to set it right. If we can’t fulfill it right, we’ll give you your money back. Promise,” the startup said on its Facebook page last December. This was the last statement from the company.

The writing was obviously on the wall well before that. In October, the startup made a rather desperate announcement of 70 percent off all items. DoneByNone had 353,252 fans on Facebook, and going by the feedback of customers on it, the startup failed to handle the demand or deliver products on time.

Shailesh Vikram Singh, executive director of Seedfund, told TechCircle that the co-founders had quit the company due to challenges in raising further investment. He also said that the company will be relaunching the site with a new team but nothing has been announced so far.

DoneByNone co-founder Amarinder Dhaliwal is now the COO of Micromax’s YU, Vijesh Sharma is on a stealth mode with his new startup, and Vijay Misra’s LinkedIn Page simply says that he was with DoneByNone till August 2014.

Ecommerce in India is a tough space for the smaller players unless they have a clear niche advantage. They can’t match the likes of Flipkart, Snapdeal, and Amazon in sustaining deep discounts to capture the market.

Jewelskart, Bagskart, Watchkart

All three niche online marketplaces were launched by Vayloo Technologies, along with Lenskart, an eyewear marketplace which is among the 15 top-funded ecommerce startups in India this year. The shutdown of Jewelskart, Bagskart, Watchkart which had more competition and less traction was therefore a strategic move to focus energies on the niche segment that took off this year.

Lenskart backers signaled their approval by pumping US$21 million into the eyewear marketplace this year. So here you have an emerging success story embedded in an apparent failure. This is also a classic VC model where the fast risers get strong backing while the slow growers get killed off early.

TalentPad

Hiring is a space with a clear opportunity as it’s in the center of a boom in new businesses. But a multitude of players are also finding it challenging to offer a clear value proposition. One of these was TalentPad which shut down less than a year after it raised funding from Helion Ventures.

The IIT and IIM alumni founded startup from Delhi had a curated marketplace model using analytics to find suitable candidates for its client companies. It even acquired its Bangalore-based rival OptimizedBits in May to boost its analytical capabilities. But months after that it abruptly shut shop with this cryptic missive: “We helped a lot of companies hire from some of the best tech talent in India and played a crucial role in their growth, while delivering the best customer experience. But, we failed to figure out a scalable business for a big enough market.”

India’s engineering colleges produce over a million engineers each year, but fewer than 20 percent of them are employable. Finding suitable candidates, therefore, is no mean task. Hiring startups have to be nimble to figure out what works.

Venturesity, for example, went from a hiring platform to a training platform before pivoting to a hackathon model for talent discovery. Another startup Hiree focuses on candidates “actively looking” for jobs, so that recruiters don’t waste time on dead lists. Initially it began with candidates serving out their notice period but changed its name from MyNoticePeriod to Hiree when it broadened its scope.

Townrush

Photo credit: Lord Enfield

Logistics is another hot sector in India this year as it feeds into the crazy ecommerce boom. Flipkart’s US$25 million infusion into Blackbuck last week was the latest of several big deals. There are well-funded players for every link of the ecommerce supply chain.

Naturally, in such a dynamic and fast evolving space, there’s bound to be consolidation as some of the smaller entities struggle to keep up. One of these was Bangalore-based Townrush whose delivery employees reportedly vandalized the office when they did not receive salaries for three months. Grocery delivery startup Grofers later disclosed it was acqui-hiring the Townrush team.

Lumos

This hardware startup in the IoT (internet of things) space is different from all the others we spoke about so far. Its founders – Yash Kotak, Pritesh Sankhe, and Tarkeshwar Singh – are candid about what went wrong, what could’ve been better, and what others can learn from their mistakes.

The three BTech graduates from Indian Institute of Technology (IIT) Gandhinagar started Lumos right out of college in 2014. The idea was to build smart switches that can automate all electrical appliances in a home. The switches would have inbuilt sensors that allow them to track ambient conditions and human presence to take accurate automation decisions and they would learn from the user’s behavior.

According to co-founder Yash Kotak, Lumos made 5 mistakes:

• We were neither experts nor target users of the product that we were building.
• We did not do the due diligence on the idea before we started building the product.
• We let sunk cost bias affect our decisions about pivoting.
• We were trying to do everything for everybody.
• We underestimated hardware.

Kotak says:

Building a prototype is the easiest part of building a hardware startup. The real challenge comes in product design, production engineering, manufacturing, distribution, and marketing/sales.

Like all resilient entrepreneurs, these three founders haven’t given up yet. They are busy building their next venture, Fundamine. It’s a community for professionals to stay connected with others in their space, exchange notes, and stay updated.

Photo credit: John O’Nolan

These were some of the failed startups that came to our attention because of the lessons to be learned from them. There are many other failed startups as well as reasons for failure that all startup founders as well as would-be entrepreneurs would do well to study.

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2015 was an exciting year for the steadily-growing Japanese startup ecosystem. The country doesn’t have the huge investment amounts seen in China, the youthful demographics of Southeast Asia, the government support of Korea, or the sheer scale of India. But as the corporate tech sector struggles to innovate and entrepreneurs break away from the safety net of lifetime employment, startups are finally getting noticed on the national and international stage.

Largely gone are the days when outsiders would ask, “Does Japan even have startups?” That’s been replaced by the much more common question: “What are the hottest Japanese startups?” You’ll come across a few of them on this list. Notable funding rounds and the entrance of some foreign heavyweights into the country are on there, too. There may even be a couple of surprises, in the form of profiles or other quirky discoveries that you saw first here on Tech in Asia.

Here are 10 of our most popular stories from Japan over the past year, in no particular order:

Raksul makes printing sexy, more than 30-million-dollars sexy

In a digital world, a startup that focuses on printing might not sound like the smartest idea out there. Well, anyone who’s been to Japan understands that you can’t go to a meeting without a big stack of business cards in your bag. Raksul connects its users to nearby brick-and-mortar printers so they can print namecards and much more for the lowest price, and it raised US$33.7 million to do so.

Read the full story here.

X Japan’s Yoshiki disputes the music subscription model

Japan’s biggest rock god made a surprise appearance at the New Economy Summit in April to talk entrepreneurship with Rakuten founder Hiroshi Mikitani. He also dropped a pretty controversial bombshell about his reluctance to embrace artist-owned streaming services like Tidal – saying instead that ISPs should charge customers who stream more and give that “tax” back to content creators.

Read the full story here.

Line joins the ride-hailing race

Move over, Uber. Japan’s hottest messenger, in a bid to morph into an all-encompassing lifestyle app, added a taxi hailing service to its roster way back in January.

Read the full story here.

Gumi’s ‘IPO hangover’

As Gumi geared up for its IPO, many expected to see the emergence of yet another Japanese mobile gaming unicorn. The company instead was forced to revise a US$10.6 million profit to a US$5 million loss post-exit, largely on poor performance in international markets. Shortly after that announcement, Gumi’s South Korean operation was caught up in an embezzlement scandal.

Read the full story here.

Japan gets its own Xiaomi

UPQ came out of nowhere in August, unveiling 24 consumer electronics products that went from idea to production in just two months. With a budget phone, an action cam, and a slew of accessories included in its initial release, it felt a lot like the Japanese version of Xiaomi.

Read the full profile here.

Stripe enters Japan

Silicon Valley-based payments darling Stripe announced its entry to Asia – via Japan – in May.

Read the full story here.

Metaps raises a rare series C round to the tune of $36m

Popular app monetization startup Metaps challenged the norm and raised a massive (at least for the local market) US$36 million series C round in February. Metaps topped our most recent list of the 15 most-funded Japanese startups before filing for IPO in July.

Read the full story here.

Vietnamese-American YouTube celebrity Michelle Phan brings her businesses to Asia

Michelle Phan, one of the world’s most-viewed YouTubers, told us last Spring that she’d be launching two companies in Asia – Ipsy, a cosmetics bag subscription service, and Icon, a multi-channel network that seeks to bring similar online personalities like herself to the television screen and beyond.

Read the full profile here.

Moneytree raises funding from all 3 Japanese megabanks

In October, personal finance app Moneytree raised an undisclosed amount of series A funding from Salesforce and a trio Japanese megabanks. While banks investing in fintech is nothing new, Moneytree says it was the first to even attract investment from Mizuho Bank, Bank of Tokyo-Mitsubishi UFJ, and Sumitomo Mitsui Banking Corporation at the same time.

Read the full story here.

Awful startup offers wakeup calls from underaged girls

This opinion piece called out a recently-announced startup, JKMorning, that promises to provide wakeup calls from highschool girls. To ensure girls employed by the venture are truly under 18, the startup’s founder told us he would check their school IDs. Similar services that involve men and schoolgirls have a history of being abused.

Read the full story here.

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One of the reasons CoShare stood out during its pitch was the team’s willingness to use humour and to build excitement in the audience

The CoShare team

For the first time in three years, Singapore hosted the global 54-hour entrepreneurial challenge Startup Weekend last Friday through Sunday.

The event, which was attended by 142 people, started with a 60-second pitches before teams were formed to begin work on the most interesting ideas. After working through the weekend, with mentors dropping in and out to help teams, the Startup Weekend concluded with a Demo-Day-styled pitching session.

The winner of Startup Weekend Singapore was CoShare — a Carousell-like company with a little twist. Instead of buying products P2P, CoShare allows users to rent equipment.

“The idea formed when I needed to go overseas. I needed a GoPro, but it is expensive to buy. I thought this [idea] could be used for photography gear,” CoShare team member Janson Seah, a 22-year-old Economics major at National University of Singapore told e27.

Also Read: Do-Cart wins first prize at Startup Weekend Jakarta 2015

Over the weekend, the idea expanded to bring in a more general audience, targetting products that may be valuable for a week or month but are expensive and not worth the permanent purchase — like a GoPro.

The main concern was security. How could CoShare prevent people from simply walking off with the equipment? Seah said the work-around was making sure everyone had their image on their profile page, as well as accurate information and geo-tagging.

For the victory, CoShare received a three-month free stay at Aviva’s Digital Garage, a co-working space aimed at fintech and insurance startups opening this week. The team will also get a Box business account, S$20,000 (US$14,100) worth of free transactions with Stripe and two tickets to the Tokyo Pioneers event in March.

“[The choice] was a bit obvious for us…I think the way [CoShare] expressed that they have models, they had the technology to build the app and they made us laugh. There was some excitement in the room for [the product],” said Lazada Singapore Co-founder and COO Arthur Brenjon Brejon de Lavergnée, who was on the judging panel for the event.

Brejon de Lavernée hit the nail on the head. During the pitch, Seah was a boisterous jokester, but did a good job of getting the point across.

“A pitch is supposed to be fun. If you don’t believe in the product then there won’t be energy. People can tell if you don’t believe,” he said.

Also Read: India’s CapriCoast raises US$3.5M Series A from Accel, Singapore VC

The team at second place was Do-Part-Time, a portal to help companies find ad-hoc labor in the event industry. Third place was a team called Investeur, who built a personal finance planning app targeted at young professionals or families that are neither wealthy nor financially literate.

The judges were Brejon de Lavergnée, Cameron Priest (CEO of TradeGecko), Anson Zeal (CEO of CoinPip), Edmas Neo (Assistant Director, Partnerships at Infocomm Investments) and Monique Shivanandan (CIO at Aviva).

The inspiration for CoShare — Carousell — began as a Startup Weekend project called SnapSell when it participated in 2012. So, the question is, will CoShare stay together and try to follow the P2P marketplace’s path towards success?

“It depends on the team. We had good chemistry. I would say it is open-ended [at this point],” said Seah.

Startup Weekend operates in 150 countries and has organised just under 3,000 events worldwide. Global alumni include companies like EasyTaxi and Zapier.

In August, US Secretary of State John Kerry spoke at the Startup Weekend ASEAN event held in Kuala Lumpur.

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With a partnership between British and Indian companies and agencies, the new centre aims to increase IoT penetration in India

Opening ceremony at the launch

HyperCat, a London-headquartered consortium of companies for the Internet of Things industry (IoT), launched a new accelerator and incubator last week in Hyderabad. The project is in conjunction with several UK agencies, the Indian government and the University of Surrey.

HyperCat is a public-private consortium led by IoT and operational intelligence (OI) company Flexeye and the public organisation Innovate UK, along with the office of the Mayor of London and the Old Oak and Park Royal Development Corporation (OPDC). The consortium is pushing a new industry standard, or ‘specification’ of an open, lightweight JSON-based hypermedia catalogue format agreed upon by the consortium, for applications to be used in IoT technologies and smart cities.

The Hyderabad hub was opened in a formal ceremony led by British Deputy High Commissioner in Hyderabad, Andrew McAllister; Srinivas Chilukuri, MD at Flexeye India; and Justin Anderson, CEO of Flexeye. Other technology partners with HyperCat supporting the centre are BT, KPMG, and TechMahindra.

“There is an important and growing tech cluster in Hyderabad, especially in Tech City, with an excellent skills base,” Flexeye’s Marketing Director, Nick Monnickendam, told Geektime. “It is also a good location to engage with and involve Indian startups. Flexeye’s Indian operation was already based in the city and our new offices are co-located with the HyperCat accelerator and incubator.

Also Read: IoT startups will get a chance to stand on the Brinc of growth

Monnickendam went on to explain the need to come up with standards for pushing IoT interoperability forward:

“Typically, existing apps have been developed in silos and it is difficult to find and re-use data in new applications – which slows down innovation. HyperCat provides a form of cataloguing or referencing approach so that machines can rapidly locate and use data that is needed for new apps. For example, if a new transport-related app needs to take data from traffic management systems, mobile/cell accelerometers and in-vehicle telemetry, HyperCat makes it a lot easier and faster to discover and access these data sets and, therefore, accelerates the development of the new app.”

The purpose of the initiative

In the meantime, the team is still working on the details, like the length of the programme and how much of a stake — if any — HyperCat will take in participating companies. The first group will probably see a typical programme of three or four months, though. The application process for the first cohort is still open.

The centre will provide a course in smart cities designed in partnership with the University of Surrey, one of the founding members of HyperCat. The incubator will focus on access to potential investors while the accelerator will try to provide quick access to emerging opportunities in the smart city market. The British government would be committing GBP40 million (US$ 60.7 million) to the new centre and the space will accommodate 40 startups, officials told the press at the launch.

A recent analysis by McKinsey gave an astronomical value to the economic impact of IoT at somewhere between US$4 trillion and US$11 trillion by 2025 — a number that reflects the penetration of IoT across the economy beyond just verticals and companies’ collective values. One of the messages of the consultancy’s analysis is that interoperability is essential to making that impact as high as possible, affecting between 40 per cent and 60 per cent of the entire IoT industry.

Also Read: The joys and sorrows of starting up in India

There are a number of other IoT accelerators that are already active in India: Cisco’s and Larsen & Toubro’s Internet of Everything programme (IoE) in Bangalore; another Cisco programme in conjunction with Rajesh Sawhney’s GSF Accelerator; Intel India’s Maker Lab, HK-based Jaarvis’ India branch, and two Tech Mahindra-backed programmes in partnership with Bosch and Texas Instruments, respectively.

Besides the members mentioned, other founding members include the city of Westminster, IBM, Intel; and the Universities of Bristol, Birmingham and Cambridge.

The article New IoT accelerator could make Hyderabad one of India’s first smart cities first appeared on Geektime.

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As we enter the post-Industrial era, the dynamics of the firm and the workforce are going to change radically

Hubud co-working space in Bali

A few years ago I was sitting in a classroom at the London School of Economics debating unemployment with my Nobel Prize-winning professor.

The conversation was centered around another LSE Nobel Prize winner, Ronald Coase, who, in 1937, observed in his scholarly paper, The Nature of the Firm, that firms exist in order to reduce transaction costs and take advantage of economies of scale.

Barring external forces, firms will tend to grow larger and larger over time. This is the fundamental economic framework powering the world economy since the industrial revolution, driving corporate behaviors such as: corporate structure, the rise of M&A and 20th century management theory.

A few weeks later, Ronald Coase at 101 years old, would go on a podcast and declare his 80-year-old Nobel-winning thesis obsolete. No longer do you need to scale the size of a firm just to obtain efficiency, with modern technology and today’s demographics, you can capture the same value with much smaller firms. Companies will still grow to be larger over time, however, they won’t grow as large as they have in the past.

Since then I have been thinking deeply about what has broken down Coase’s theory, which was the fundamental underpinning of the world economy since the Industrial Revolution. After several years of reflection on this, I have come up with four forces:

The rise of the freelancer economy
Millennials’ behaviours and impact
IoT and lean hardware
SaaS economics and the democratisation of IT
The Rise of the Freelancer Economy

According to a report by Intuit, by 2020 approximately 40 per cent of the US workforce will be working as freelancers. Another study predicts 50 per cent by 2025. As more members of the workforce decide to freelance, the number of marketplaces to facilitate them will proliferate.

In the past, you would hire the reputation of a Brand. Tomorrow, freelancers will build a reputation on a marketplace and the marketplaces will build a brand.

This trend will lead to more commodity-based and strategic outsourcing. Commodity-based outsourcing will consist of outsourcing HR, legal, accounting/finance, manufacturing and software development. Strategic-based outsourcing via the freelancer economy will outsource product development, design and even management.

Millennials’ behaviours and impact

By 2020, Millennials will consist of 20 per cent of the workforce, and by 2025, 75 per cent. Millennials were born mobile and digital; their behaviours will change the way companies interact with their customers as well as how companies interact with their employees.

Everything changes, from preferred methods of communications (messaging) to marketing (social media), to commerce (mobile first). Traditional management models start to break down with Millennials managing Millennials and selling to Millennials.

Also Read: In photos: Co-working space ‘Hubud’ is Bali’s Mecca for digital nomads

IoT and lean hardware

At the same time the Millennials are taking over the workforce, we will have 26 billion IoT sensors in production and connected to the Internet by 2020.

Cheap sensors and widespread availability lead to more Big Data-driven analysis about everything from the lighting in your office, self-driving cars, the temperature of your home, to how your dishwasher runs.

Abundant sensors combined with cheaper and small-batch manufacturing will drastically change business models, pushing them to be more service-oriented. Robotics and AI will eliminate most unskilled jobs, driving employment to be more skilled and knowledge-based.

SaaS economics and the democratisation of IT

While the move to the cloud has already begun, over the next few years, it will be massive. The economics of SaaS software has shifted the decision-making power to the line worker from the management and IT.

Since you can swiftly deploy cloud-based software within your organisation with a free trial, cheap monthly credit card payment, and no physical installation, employees are now making the purchasing decisions, not the IT department.

This is breaking down siloed data, enabling remote/distributed teams and creating more capital efficient companies.

Also Read: With platforms like Freelancer.com, the world really is becoming flat

The next 10 years

As we enter the post-Industrial era, the dynamics of the firm and the workforce are going to change radically. As the forces that are breaking down Coase’s model only grow stronger, many companies are remaining stagnant. The success of a company no longer depends on growing larger, but now depends on being the optimal size in order to fend off the disruptive smaller companies.

Google figured this out when it broke the company into smaller pieces and formed the parent holding company, Alphabet.

The larger this gap between big and optimal-sized companies grows, the less chance there is of survival for companies trying to grow by growing bigger, opening up great opportunities for disruptive startup companies.

Even more interesting is that this transformation will happen in the next ten years. How tomorrow works is radically different than it is today.

The article How Tomorrow Works by Stephen Forte on Medium.

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