Ubiquity 6 co-founder Anjney Midha argues that aspiring entrepreneurs should work at early-stage startups, not venture firms. Six months at a startup teaches more than a two-year MBA. He warns that being too early kills companies: Fabmart failed in 1992 India, General Magic built iPhone tech a decade too soon, and dozens of mobile-payment pilots flopped before M-Pesa succeeded.
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VCs are— you've got to remember, as an industry, venture capital is really, really early and nascent and really small, actually. It's a cottage industry. Firms are usually pretty small groups of 3 to 4 solo players who just happen to be investing from a fund. So I don't find that to be— those to be great learning environments if what your actual goal is to start a company. But startups are. Go work for a startup. Any other questions?
Yeah. Hi, I have a question about what's the best path to take to start your own startup. Even if you have an idea, for example, would you rather go for VCs and work with them for, for example, a month or without an idea for a year and then work on your own startup so you know how VCs work from the inside so you have a bigger chance for I think a ton of them.
No, I think going to work with VCs is a pretty indirect way of getting the experience you need. I do think if you feel pretty— to your question, if there's a domain you care about and you know that there's a business you want to build in that space, but you don't have all the quite the requisite skills, the next best thing to do is to go work for a startup in that space. You will learn way more by working at a startup than you will either like reading TechCrunch articles or working at an investment firm. In fact, I think startup, like 6 months at a startup is equivalent to basically a 2-year MBA. And you will, if it's an early enough startup in the domain, you will learn everything, right? You will see how they solve product design, sales, marketing, fundraising. You'll get a crash course basically in the entire entire space. That's why I think the Bay Area has this really strong culture of people joining startups and then leaving and starting their own companies in the space. And often founders will end up being your biggest supporters. There's a ton of people I know at Ubiquiti 6 who one day might end up starting AR, VR, 3D computer vision companies, and I will support them because they came, they helped us grow, and at the time when they didn't have all the requisite skills, they got the experience they needed. So that culture is pretty strong in tech. And so instead of going to a VC, which is this weird place— VCs are, you gotta remember, as an industry, venture capital is really, really early and nascent and really small, actually. It's a cottage industry, and it's only been around for about 30 to 40 years. So the practices in that world are really not formalized. There's not a strong, like, mentorship or guidance structure in place. Firms are usually pretty small groups of 3 to 4 solo players who just happen to be investing from a fund. So I don't find those to be great learning environments if what your actual goal is to start a company. But startups are. Go work for a startup.
Hi. We're talking about that a lot of startups fail because of lack of infrastructure, right? That they were way ahead of their time. So you might relate to the story of Fabmart, like when consumer internet was kicking off in US.
Right.
And Fabmart opened in '92 in India, but the infra was not ready in terms of regulatory framework, no internet service providers, no payment gateways, no personal computers. But do you think that being early pioneer in the space in this information age also helps you collaborate with decision-making bodies and drive adoption? So when the actual adoption is happening, you are one of the early movers in that space?
I think that sounds attractive intellectually and academically, but I don't think it ends up actually following through in practice because of the just sheer amount of friction there is between, and difference in incentives there in between these decision-making bodies and the incentives of the free market. So a good example, a case study to look at is the mobile payments market in Africa. M-Pesa, which ended up basically revolutionizing the way payments work in Africa, did not come from a startup. It came from a telco, right? And it came because the telco's incentives were strongly aligned with, with the technology experience of bypassing traditional banking institutions. But M-Pesa was nowhere even close to being the first mobile payments service in Africa. There were maybe close to like 50 or 60 that came and went before that. And all of those founders, I can tell you, were part of the roundtables and the planning commissions and the organizational plenary sessions to plan the improvement of infrastructure and payments in Africa. And none of us know their names. They're all gone to history. So what you're describing is, is I think worthy from a— it probably pushes forward the effort. But you end up basically being a footnote in history. And I think the company that ends up capturing the most value is the one that arrives at the right time and gets essentially the largest market share when the infrastructure is ready. A good example of this in hardware is the company called General Magic. I don't know if any of you have heard of this company, but if you haven't, there's a documentary on it on the internet. You should go watch it. Every founder should watch this. General Magic was a group of really talented people at Apple during the phase that Steve Jobs was fired. And they were some of the most talented hardware, software product people in the world that came together, pure artists. And they basically built the iPhone a decade before the iPhone. And none of us even know, like most people here haven't even heard of that company. But they did all the hard work you're describing. They went and they got the FTC on board. They got all the big telcos on board. They said, we've got to push mobile infrastructure forward. We've got to get 3G. And they ended up being a footnote in history. And Steve Jobs showed up a decade later, hired a couple of those few folks, and the iPhone basically ended up being the most successful tech product of all time. So I think history is kind of against you there, where you end up doing a ton of valuable benefit and contribution to society, by dedicating all these long hours working with these government makers and decision makers. But if your ambition is to be a startup founder and to build a really big, massive, profitable business, you're probably better off not engaging with what are really big organizations with people on pension plans.
Yeah, so you're suggesting that like Amazon came late in India when Flipkart did all the consumer education and built the infrastructure and drive. Like scale at a faster pace.
I think Bezos is looking pretty smart right now in India.
