IEEE Power Electronics Magazine - June 2014 - 26

Entrepreneur Viewpoint

by Deepak Divan

the start-Up's Dilemma

o you are ready to take the
plunge and become an entrepreneur. Most successful entrepreneurs know they do not have all
the answers, maybe they have none of
the answers, as they set forth on their
journey. However, there is almost
always a latent need in the market
that is visible to them, possibly only
to them. Nobody is clamoring to have
this need filled, and there is certainly
no budget for purchasing a solution to
fill this need. Legacy competitors are
behemoths with legendary technology
gurus in their ranks, with spectacular
products that defined "cool" just a
few years back. These are tough,
almost impossible, odds-yet entrepreneurs routinely launch their companies with an almost brash conviction that they are right and that the
megacompanies are wrong and are
certainly not addressing these latent
opportunities.
As a start-up, you will face many dilemmas, and your intuition will often
lead you down the wrong path. Some
of the more common issues you will
need to deal with are discussed here.
In subsequent columns, the columnist will share learning and
experiences, as well as discuss
challenges of obtaining venture
capital funds.

Digital Object Identifier 10.1109/MPEL.2014.2312280
Date of publication: 20 June 2014

IEEE PowEr ElEctronIcs MagazInE

■■You

would like to apply your deep
domain knowledge and excellent
execution, learned from decades in
the field, to start-ups. While this is
critical when the start-up is finally
scaling, excellence in execution can
be a real problem in the early days.
If you do not know where you are
going, what is the point of a great
process and fast and relentless execution? It only uses up resources
you do not have and often commits
you to an unsustainable path.
■■If the team is led by domain experts,
it may see the world in the same way
as the market leaders. This makes
disruptive technology introduction
more challenging. One has to be
ready to challenge orthodoxy-a
"sacred cow" may have been valid in
the past, but some underlying change
in technology, regulations, or other
factor may now make the disruption
possible. However, just because disruption is possible does not imply
that it should or will happen. The
best drivers for change are people
with a reasonable understanding of
the current basket of technologies
and solutions being deployed, frequently from an adjacent space, but
without a sense of "ownership" in the
dominant technologies.
■■Market leaders pride themselves on
precisely knowing the voice of the
customer, with inbound marketing
programs that drive product requirements-their success depends on
this. As Clayton Christiansen pointed

z June 2014

out more than a decade ago in The
Innovator's Dilemma, this is also the
reason why start-ups (or upstarts!)
can eat its lunch. It is very challenging, even for the best companies, to
steer the company in a new unproven direction when its top customers
are clamoring for more of what's already being provided to them.
■■Start-ups typically do not know
what their customers want or need
as there is typically no exactly
equivalent product in the market
(unless you are a fast follower). The
job in the early days is to frame a
hypothesis, not just around the
technology, but around the business-and to then test the hypothesis with real end customers under
realistic conditions. The objective is
not to succeed on the first try but to
fail fast, fail often, learn fast, and
pivot as needed, working on formulating and testing a "minimum viable
product" that provides realistic
feedback to the team on acceptability of the proposed product/solution.
The learning really begins when the
first data from the customers start
to flow. As their use cases are better
understood, a value proposition can
be developed, and the viability of
the business can finally be assessed.
■■The real job of the start-up is to
hunt for a business model that can
be replicated at low cost and can be
scaled [1].
(continued on p. 28)

Table of Contents for the Digital Edition of IEEE Power Electronics Magazine - June 2014