From Brink of Failure to Success :The Story of Sembian Samuel

To struggle and succeed is one thing, and to rise after fall is another. In our series of startup failures, we covered the story of Abhijeet Khandagale and Kamal Kalra earlier. Sembian Samuel started the company with his friends, only to find the startup in deep crisis after the founder left. With a choice of quitting and bouncing back, he chose to bounce back and made the startup a successful one. “Success is not final, failure is not fatal: it is the courage to continue that counts” by Winston Churchill best sums up Sembian’s startup journey!

What was your startup idea? What market research did you do before plunging in?

Our Startup idea was to start a technical training, software development, graphic designing and branding. We four started each in an area of expertise. We haven’t done a market research at all and that was the biggest problem. Since there was no analytics we couldn’t do a proper strategy.

 How long did the startup run, and what were the early signs of trouble?

We started in July 2012 and ran till march 2013 (8 months) until our Founder Director quit the company leaving back the team alone. Trouble was lack on sync in ideology. So planning was based on the single person’s view rather than a team work.

 Were you full time or part-time working on your startup?

We were working full time round the clock. Mostly will leave home after midnight.

 When do you realize that this is the moment to quit, and what went on through your mind at that time?

When I realized we couldn’t change a person’s basic character and ideology, and because of that the company is declining and sure will result in failure. Also company’s overheads were shooting high day by day, I thought to hold on and revamp later.

I had been thinking about my investments (which was given by parents by bank loans and pledging documents), to face the society because many opposed to start a business, my career next, girl waiting for me, my friends and peers who has already settled because of lucrative jobs in MNCs. And ultimately “what NEXT”.

 How bad was it, after the startup failed?

It was paining because we started with lot of dreams in becoming a leading software company in ten years of time as other young startups.

 In introspection, what could you have done to save your startup? Would more money / connections / mentorship / expertise have helped?

I would say more than money, mentorship and expertise would have helped to save the startup. Since we were young i.e. 23 years while starting a company, we lacked in the experience in handling finances, budgeting, hiring number of employees, project management, pricing etc.

How did you bring back your startup, from the position it was when the Founder Director quit?

At the time when our founder director has left the company, we were in serious crisis. Debt was around 8 lakhs which was so huge for me because I am from a normal middle class family. Then I started analysing what went wrong for this huge crisis and figured out the below mistakes :

1. We didn’t have a clarity of thought what we are gonna do inside Data Crawl, our company and did everything what we could do. So concluded that planning was missing to the core.

2. We started so big and borrowed a lot of money to face our monthly expenditure

3. We didn’t have any rolling cash or back up fund for immediate needs and for the need of money, we agreed for projects which we were not interested.

4. Meetings with the team was unproductive. It consumed a lot of time and its was my partner’s attitude to have long meetings with the team.

So after figuring out the mistakes, I took the below measures –

1. I motivated my self not to close down the office, since it was our dream to start a company and also huge money has been invested.

2. I motivated the team and assured them within 3 months of time, the situation inside the company will be stabilized and I will able to pay them the salary only from the fourth month. And they were so emotionally attached and gave their full support to work without pay for three months.

3. Then I made a plan for the projects, what we should do and what we shouldn’t do. And concentrated on the projects which will bring in quick money to the company rather than the big ones.

4. I started settling the more immediate debts and requested others to give me some time to settle it. And I spoke to the investors (that is our family members and well wishers) and promised them that I am responsible for their money.

5. I just said no to the clients who were not our target audience and did projects only to specific audience and they were amazed with our quality and commitment. So the satisfied clients gave us reference and that really helped us a lot.

6. Then I spilt up the team and revamped our product which was our dream project. Now the product is ready and we have started our marketing. This was really an achievement according to me since I faced a lot n lot of mental pressure from investors, land lord, employees, peer pressure, society, etc

7. Still I have not recovered fully from the debt and impact due to our mistakes, but things are changing slowly. Now I have two ventures. Acstoproda – Software (www.acstoproda.com) & Two Stones – Creative Studio (www.twostones.in)

8. My greatest support was my family who have never spoken a single word which would hurt me and gave all the moral & financial support (for the fact, I haven’t given a single rupee as salary till now) & my loved one who has immense level of faith in my capabilities and still waiting for the day, I achieve. And my Hope is always in the Lord.

What suggestions would you like to give people venturing into entrepreneurship, based on your experience?

1. Never start a company with a close friend whom you knew for years rather you could start with a friend whom you have come to know in business. Because it’s not mandatory that a good friend will be a good partner to work with.

2. Start a business with your area of expertise rather than depending on a partner or others. So that you could stand alone and manage at the time of crisis.

3. Aim high and start small. Because sure we will make many mistakes in the beginning and gain experience from that but will drain all the money and resource during the course of time.

4. When it comes to business see it as business keeping your emotional side apart. When partnering with someone talk about ideas, plan, working style etc. in detail prior.

5. Budget your monthly expense and keep at least three months expense amount as a reserve at bank.

6. Never hire employees unless most needed and hire a talented employee rather than many unskilled persons.

7. Do a thorough market study and collect all the information prior stepping into a venture and plan a strategy based on the collected information.

8. Always sales matter for a startup. First start earning money, manage your finances by meeting your expense rather than by getting debt.

9. Don’t plan your marketing for a larger market. Plan for a specified category and provide more service.

10. Talk to experienced people in business before starting a company and learn from their mistakes so that you could have your time and money.

11. Never think a person with you is more brilliant than you. Believe in you rather than others. Many persons in startups depend on others imagining that they are so talented and that person will take care of everything.

12. Don’t imagine a company from a comfortable zone unless you have a big capital.

How has this transition impacted you as a person?

In my case once our founder member stepped out, I took the responsibility for our team. We started in a new name with a same team. Now everything is going fine. But it took more than 9 months to settle from the impact, manage the debt, change the strategy, correct the mistakes etc.
I have many positive impacts rather than negatives ones. I have gained immense level on experience in handling crisis, finance, people, clients, team in a span of 18 months which no corporate could provide.

It’s not easy to bounce back, once failure starts looking imminent. Kudos to Sembian Samuel and we wish him all the best!