 Scaling up is very important for any business. This is not a choice. You need to really scale the business and today in the session I will split the discussion I'll do a quick summary of what we did discussion the last Addition of scaling up so that people who not intended the last one really get some Understanding of what we really covered and then we'll go on to the next topic for today That how do you really use scale and what you need to do and how do you bring some kind of a structure in your scaling so Especially in these times, you know Scale has become a little bit of a back burner for a lot of companies and they're thinking of more sustainability and controlling their enterprises and so But I think a little differently I always think that when market shrink you have to really think through that how you improve your market share And I feel that the good strong companies and strong entrepreneurs would always find a way to really see through That there is an opportunity for doing it like I was in discussion with one of our companies which are aggregating Banquets now on one side They look like the business is now on a very very bad stage Banquets are not working operational in so on the other side I see this would be a huge consolidation opportunity because a lot of independent operators who were running their own independent Banquets would not be able to sustain So if there was somebody who's able to really put a framework together There would be a much larger consolidation opportunity and I see that very clearly Both on the organic and the inorganic framework. I think there are many opportunities which would emerge especially 2021-2022 Would be a great time for companies to really scale up and find different opportunities Not only home markets, but a lot of other markets Indian companies can skate and I I feel that the scaling up But while it has to done very very consciously because you need to really forecast your your financial performance much better Then we ever did in whenever we plan this game So let's revisit what we did last week and we first defined, you know I've done my own definition of what I call the scale and I define the scale by You know S stands for what I call the strategy strategy has to be whatever I will short term and a lot long term Both has to marry between them, you know, unless you have a very especially in these times You have it to have a short term strategy, but you have to have a bigger Long-term strategy. So how do you really define your strategy? How do your strategies? What your business model is clearly differentiated and how do you really? Go deep down into your your business model to make it more sustainable So to say for next four or five years. So what is your brought them a strategy? And I would say that this is a good time to redraw your your strategy for the business That's S stands for strategy C stands for three different things one. I call the culture I call it a competitive advantage and also your core competence How do you really bring these three things to your your business model and and also to your organization? How do your culture is moving now and how the culture and how what is your competitive advantage and third is your core competence? Whenever you're scaling up, you cannot take everything along find your strong core competence and focus on that That's where the real value lies and I think a lot of companies have let go a lot of other performing assets around them Just because whenever they look at scale, you know, for example, Gillett As a company a long time back the people don't know they used to also own Parker pens It's a big big company They used to have a lot of writing instruments and they let go these businesses Because they wanted to really focus on their core product, which was their shaving products and the grooming products So fundamentally a lot of companies at a given point in time left their profitable businesses Because they want to really focus on their core whenever you think about scaling think on core competence Think on how do you really create culture and how do you really integrate culture because whenever you scale? integration of culture becomes a very big problem and stay honest to your competitive advantage third which stays for a a comes from Actionable plan and setting accountability. They both has to marry together. You need to have a very strong actionable plan You know, which can be really put to work and also need to set accountability to really see that how your plan is working out And how it is progressing and all the stakeholders whatever be responsible for Executing that actionable plan are set to accountability and the expectation is aligned and what is expected from For so another area, which is very important for you to really think through is what I call the liquidity which is The L stands for the liquidity liquidity is that the company when you scaling up and we'll talk about today's session Also, I would need capital and how do your liquidity is stacking up and what is your current state of liquidity? what is your current, you know, you're sort of say liabilities and and You know profits are stacked up and and and how it is going to look like in next three to six months and these equations have realistically changed in last Four or five months in companies companies Which were very healthy at one point I'm from a balance sheet are not so healthy at this moment So you really have to carefully understand what what your library side looks like and what can be the future library? Because another three to four months six months. We still don't have that kind of a clear predictability But how does it stack up? But if some companies either have strong liquidity or can have Ability to raise liquidity. I would say they are in a golden era They would get into a golden era from a scalability viewpoint this time around it will be all driven from liquidity I think a lot of companies which would shine in this time would sit I mean companies Which would have ability to organize liquidity and and one of the companies we clearly saw was reliance industries Which was quickly able to raise a lot of liquidity and I can clearly see what is a three to five year plan because Almost every good asset would come their way And they would have ability to choose the right asset if they don't make the mistakes on picking up some wrong assets But I think this would be the perfect time for them because they quickly turn around unlock their value Raise their start sitting on a big chest on reading liquidity And now they're ready to go and create that and so multiple news would continue to come from their group I think over next three to four because It's not only just liquidity It's also to quickly deploy that cash because you're unless it you sweat out that capital You will not be able to deliver the promise to the the investors and stakeholders you've gotten So it works hand in hand You need to know when to raise and where to deploy and that cycle has to done with very very quickly Because neither the money can sit anywhere Money has to be sweat out and then only it creates and that and so it's very clear Ideation When to raise and we'll talk about in the next section and finally is the execution execution has to be seamless And it needs to create experience. It needs to create impact. So how does it your your overall execution is shaping up? So scale is defined by a strategy. It's signed by culture culture Competitive run and also for confidence. It talks about actionable plan and accountability It talks about liquidity and finally is the execution. That's what to me scale is on and scaling up we talked about last week Last plus week also on on three P's which I call are very important to get alignment When you start thinking on scalability and these three people is once people your people alignment has to come in Your process alignment has to come in and your performance has to be some kind of a performance management Capabilities have to come in if these three P's are aligned which means there are people aligned Processes aligned and your performance management is aligned. Then I think the scaling would be very interesting So this is what we covered the last time So we talked about a lot of things in terms of the strategy and and all the five elements Which we talked about a principle definition of what houses scale could work but today we talk a little differently in terms of how Companies look at scale in and I call it different cycles of scaling and you need to really by design put different cycles I call the hallmark of a successful scaling is knowing when to hit the brakes and then only you can get to the next Orbit, so that's where the value lies You don't need to really go scale take a hold take put your brakes redefine your strategy redefine your position of liquidity redefine your Integrate your culture and then start scaling up. You need to do this cycle Multiple times to find different orbit change and so on so now today We will discuss about the five things which you need if you are thinking on getting into scalability Then what are the five things which you would need to really bring in the business? One I think let's understand scale and growth really comes from my own experience says only from three things If you if you just don't concentrate, I mean leave aside all the other things and only focus on these three things Then you will be able to get all your answers of scalability or growth or market share Three things which really can create a scalability is one I call new markets, which new markets you can go You know who's your new customer which you can address Where is this coming from and so on so new market really clears very clearly One definition second is new products What are the new products which can come in and address the same audience which you currently have and third is a new channel Which means that what other channel you can use for for your growth between these three things I think your answers of growth really comes and that's where the scaling up really starts on So now I call it up whenever you are looking to get into Scaling then first step which you need to start is what I call evaluate your current position and create a bigger road map So, how do you create evaluate and plan your larger structure? So let's do I mean we call it assessment map You know, how do you put your assessment map with the current capability and organization and draw? How their plan would look like and put out on that so the assessment map I divide that into three parts One is predictability and predictability comes from you assessing how we would be able to gauge the performance of your organization and Also the priorities of the consumer So how the organization is going to perform and how the priorities of consumer is going to change and Unless and until these two are married, you never be able to come down to firm predictability Sometimes we lack on the performance of the organization itself. There is a clear opportunity There is a clear business model out there, but we lack performance Your teams were not ready to pick up that opportunity and we have seen it many many times Almost three or four companies. I know started when they aggregated hotels or almost every aggregation happened in this country They would every time there would be six seven eight nine players Simultaneously would come in they all saw the same kind of an opportunity. They probably had the same kind of technology They all had the same vision instructor, but very few were able to go to the next level The only companies which went to the next scaling up cycle were very clearly Marrying the performance and also they were having the strong predictability or priorities of consumer So how like like a flip card flip card Essentially was a very very close copy of Amazon Amazon was a platform for selling books And they were also selling books in India Quickly they understood that the priorities of consumer is changing very very fast and they continue to evolve and they also obviously they had The similar kind of structure which was happening, but there are many other names I would know which were also there in the same structure But they were not able to evolve as the priorities of consumer Now look at what play card is doing now selling groceries selling other things But original plan of the business model was very very different and very structured I think the founders never thought that they would be doing this what they do You know as a business model, they were not designed even the brand was not kept to do what they're doing now so Eventually the very clear mindset as a founders were that they need to continue to scale and as the scale within them I think they continue to build their performance and also to continue to gauge the priorities of customers and how the Brighties are changing and sometimes I think your performance is excellent Top-class performer, but you're not able to see how consumer is changing like look at lens cut lens cut is another example pure play online company a strong online play for a few years But they realize that whenever people buy opticals, they need to get their eye testing and this was impossible They did almost everything they created online tools They started even doing going to people's home and trying to test that but eventually they realize there is a only one way To run this business is is running an offline a retail outfit now being a pure play online company Has now a very large retailer in the country because they understood and adapted to the privacy of the store So while their technology they married, but they understood where the customer is and they became very loyal to one What they wanted to they continue to ramp up their performance capability from a being a very technology Now I think they've become a very strong retail experience organization and Within all that happened in 10 years where you have evolved as a technology company and now you become a most experienced retailer Also in the country where a lot of other players I should not mention a forum, but they a lot of other players bigger companies were not able to gauge that So so this this company these companies are like because this that's why they're able to scale so much because they are able to marry these two things the first thing in your assessment map should come how do you bring predictability from performance and also from the priority of a customer second is your gestation cycles Another area which I have seen in scaling up is whenever you start scaling up you under estimate in some forms the you know the market how it is evolving and sometimes overestimate your capabilities. So both are wrong You know you are under the estimate from how the market is going to Go on to accept you. So I call it a very clearly the gestation cycles again has to have two things very clearly How how what is your go-to-market strategy? What what time it would take you to go to market? What kind of gestation you see there and second which is also very important Sometimes we design that we will be ready in three months to hit the market We will be out there with the customer and so on but we don't understand that there is another component Which is there which is how the market would shift to you So the market is consuming. Whatever they're consuming out there, you know say you are a new product in I think you obviously have Your own product differentiation, whatever you have But there is somebody using something from somewhere already, which means that they need to also shift So gestation cycles should always come and marry these two things together one What is your go-to-market strategy and what is the market shift cycle? What is a market shift cycle how much time it will take for you to ship say you are a Retailer or you are a salon now you open up in a one location one is your go-to-market Which means that how do you get the market to your marketing on your entire thing? But somebody is using some salon in the same neighborhood The people are not waiting for you that you will just come in and do that. So sometimes this this structure is not very well defined and companies are not able to sustain and They start collapsing very fast because they they are not able to put this a right number in mind So even in our consulting practice now we really go down and say what is a go-to-market time and also what is a time frame we require To shift that market and how that compelling the shift is going to be done over four quarters or five quarters And by the time we reach to our optimum performance or a peak performance and so so those things are important The second point is your gestation cycle third is your organizational capability development You know, so when you scale up how soon you will be able to build your capability and what are those capabilities You need to really define and build and these capabilities are both at the at the entrepreneur or a leadership level and also your organization sometimes Organization lacks capability, but entrepreneur has a right vision and right structure Doesn't marry sometimes organization is pretty ready But the entrepreneur or leadership team doesn't have that future and this creates a huge clash and understand these two also Married it doesn't work. So whenever you starting to think on scaling You need to evaluate and plan and create your assessment map in your assessment map Go by these three things bring predictability, which is performance and priority go by gestation cycle Which is go-to-market and your market share you know shift and Third is your organizational capability development and entrepreneurial capability development developing together. So that's how it would create results Now the second point after once you've done your your Evaluation and and planning the second point which would become is obviously capitalization You know and capitalization is also a life cycle. You know, it's it's a continuous capitalization For it's another directly proportional to your scaling So if if you feel that next five to ten years is your scale time and you need to reach to a different benchmarks similarly your capitalization capital base also need to scale now The difference is that scale and capital raise work on a different timelines So it needs to have at least 12 months to 18 months kind of a life cycle for the next scaling up cycle Which means that if you are today thinking of scaling up and you feel that you will reach to a certain level For your next orbit working. You might have to start now because the 18 months from now you would again need capital So it works absolutely different. I think now intelligent companies on one side They have a team which continues to work to fill the their number guidelines and their scaling guidelines and so on So they continue to chase that and there is a separate team and sometimes founders divide these roles You know, if there are two founders one founder was continue to work on the on the capitalization scale And someone found that is chasing numbers whatever the market guidelines you give so you need to really see how do you? Position that I always say that put a separate team Which should we should not really be involved so much in that that thing and they continue to think through how this Capitalization would be done and the answer for capital raise is today. Absolutely equity equity is the best way to You know raise your capital base and that's where Intelligent companies are doing that even the largest companies who have phenomenal balance it again I come back to reliance because a lot of examples Really are coming from them in terms of what they do and how they are thinking process is working and and unlike what we have seen Reliance industries in last four decades They have either used capital market or they've used debt to really do that But they're very near you would heard that they would off loaded their own equity to raise capital This is the first time in probably in the openness They've done and they have all started rather be started last year when they started inviting oil companies to become partner They've gone larger, you know Company out of Saudi Arabia to invest with their refining business and a lot of that Thinking process has started because they understand now for them to grow This business would need a strong Unlocking of their equity and one of the areas where Indian businesses are sometimes not able to do that because they keep their equity Too close to themselves. They don't unlock it and I feel that the best form of Going forward and capitalizing your business is unlocking your equity So that's where so think over it that what is your what is your growth need and how much capital at what stages you need And who's working on that piece for you now? Let's go into the third part of it, which is also very important and Very very critical when you look at the scaling up is actually predicting your consumer demand side Now consumer demand I further divided into four different parts One is overall defining the market. How big is the market and what is what is happening in that market? Is there any risk of any kind of a surprise product substitute? Which is coming in the market because these days destruction has become the biggest problem for businesses Almost every business suddenly become irrelevant because there is unseen Competitor who's just shows up and he has a phenomenal substitute of whatever you're producing on that You know, so Ola is actually over is a substitute for automobile companies to sell cars to end users Because they don't need it now because they would use public transfer. So any kind of a destruction today Can create a big problem in terms of how you need to do so you need to really see that what is a big picture What is your market and define your complete market and go to the core of your business and define the market and don't limit by Geographical spaces, you know And this is one of the areas which we struggle with a lot of Indian companies great companies because sometimes they limit themselves by Geographical presences, they don't they don't really they have phobia of just limit themselves And I feel that this is a time where companies have to start thinking a little more wider and say Wherever that customer is that's my marketplace and how do I reach that market place or define your market place and define the structure Then second is break your marketplace into smaller components Understand the smaller components. Hey, I was a tire. Now my market place is everywhere and But now I would like to divide my components and components would be passenger car vehicle car Public transport a lot of other thing industrial Requirements of multiple other smaller components would start coming So I will need to define smaller components in a structure that where are these demands are are going to do that Then I will go third point which is I will drive forecasting the driver for each of the component Which is what are the key drivers? What is happening on on each of the drivers? Sometimes we take a broad marketplace doesn't make sense because we need to first divide into a smaller components And then then components twice also drive that are key drivers for each of the fun So I will if I want I have manufactured I will go very clearly Understand where is a demand coming in this dry this component? What is the amount coming in this? What is happening here? What is happening? And I'm surprisingly you will find that When you start breaking it up even in these times. I have realized and worked with a lot of companies in last 120 odd days and I found some part of their business is still very interesting to scale You know while this looks like from a broad viewpoint It doesn't make sense But there was a component in their business model which was very promising and had an opportunity to grow So and that's where we start looking at it if I look at from a broad viewpoint Maybe I would not touch that business But when I look at a smaller part of the business it might be and I think like for example I was doing one food brand and the food brand is a restaurant and a delivery brand But they also had a FMCG line between their business model and that to me on other side The food is not doing well But this particular line of FMCG which they had some packed products Which which can become a very very large market place rather they would they would be Able to get a shelf space very very fast on that space So one has to really understand What is the smaller components in your business while your major business might be at a certain risk But there might be another component which would come through For everybody and now companies are now intelligently looking at you know even hotels have started delivery To giving that I think almost every hotel you go. They found Deliveries which are working while it will not fetch the from a corporate viewpoint might not make a Financial sense so much in terms of what they do But they are trying to sweat out some of their components where they see there can be a positive impact of whatever they do So divide that and third point is Forecasting the drivers of that that demand in each of the component and then do what I call periodic Sensitivity analysis on each of the component performance to keep every quarter Understand that component that how that's changed now and what is going to happen in the next quarter Unless or until you start breaking this up They are consumer demand and go from a complete understanding a full market then go to a little bit of smaller components Then understand the key drivers on the each component and then continue to do every quarter Sensitivity analysis of how this demand might change or has changed and so on so third part would be very very clearly that you need to really Understand that how the consumer demand is behaving and how it is changing going forward Now the fourth element, which is very important is how your leadership Organizing their team is designed in your organization and leadership is just not limited to the management rather I think management sometimes itself is a limiting answer on the scaling of companies and a lot of private equity companies these days at a certain point time really take a call to move the founder out and And sometimes work very well It sometimes does not work well because I feel that sometimes the leadership itself becomes a very big roadblock for companies to really think Through and leadership at all levels. It can be at a department levels and so on so forth So a lot of these challenges are very important So you need to really see What needs to be done and I think the purpose of hierarchy is actually to destroy the Bureaucracy, you know companies when they come start scaling up They have a lot of bureaucracy coming and the whole purpose of having some form of leadership and trading this hierarchy Is to actually destroy this bureaucracy because I feel that the biggest problem in scaling up Organizationaly is that the organization stops behaving in a similar manner and they create a lot of unwanted bureaucracy within the organization and that's how the companies are not able to grow so one of the purposes which you have for that creating this whole hierarchy itself is that you break that If you feel that that some form of leadership sitting at the top is actually not doing that purpose then it's as lost as point in that structure So you need to sometimes also I say that what I said we need to really slow down to one of the areas which I say that companies when they're scaling up They need to sometimes take the breaks and and then give back how they can bring the the whole culture which comes from the behavior and the beliefs And the culture of behave your organizational behavior and the beliefs you have set for organization Sometimes you need to reinvest back and you need to really invest back and that's very clearly Which needs to be done. I always feel that at a certain level Maybe the the you know the the founding team might not change but you need to invite future leaders in the organization and sometimes leaders come within the organization sometimes you have to bring from outside because You know, I say this that the leadership is about moving people's attention from away from what is happening in the present and They actually give them to thinking that what is the future holds for them So that's where the leadership is to be leaders should really take people's attention from the current things going on What is presently happening and give them a little bit understanding of what future is holding for them And unless at a particular level the same leader is not able to do that You need to really change the leadership and this is one of the areas which I feel the mid and small companies are not able to grow because they They are not able to get those kind of leaders who can really bring that kind of an excitement that what it holds for us And sometimes they need to really do that and sometimes you hire consultants and other people they can give you So to say a mood board they can give you a Perspective but somebody has to run the ship So I feel that one of the reason areas which especially mid and small companies really you have to see that what is your leadership design And how the leadership is able to pass this message and bring that culture of you know all the You know belief system in the organization so that the organization start thinking in the same line so Couple of things which one has to really juggle with your team structure when you are a leadership one evolve your leadership second, you need to balance between what I call process champions and business guardians now process champions are people who Always very good at understanding that particular process and they run that and I think but sometime They are not the most invested or more committed to the organization and you have these business guardians Which are always protective of the organization They've they run like their own company. They sometimes are not so much of a process Lead sensitivity or they're not champions of that. So in this case you lack confidence use you know and And that's very important, you know under the rate You need to bring a lot of confidence if you want to really scale up You need to have a top guy in your every of us department but you also need to guard your business because your business can go out of control and a lot of Times I've seen scaling up has actually lost control of the business itself And that's something which is which is very very dangerous even including my company at a one point time for five years back I I just suddenly scaled the company to a very different level in multiple countries and so on foot and I lost control on many many markets Myself and I felt that I was also struggling with these two points How do I really get process champions who understand the process? But they might not be the most you know What I call business guardians and sometimes I bring in too much of business guardians out there They lack competence and so forth. So this struggle could always go down But this is a very careful answer is that how do you really able to define that in the business? Another area which you need to really balance is what we call the pure thinkers your think tanks and your executors Again a big difference in both of their and that I think sometimes thinkers are not the greatest executors and executors Are not somebody who really think how do you marry that also? So three things I always say just do balancing of evolve your leadership balance between your process champions and business guardians thinkers and executors Understand and define your team by that spin point your team members and say who's your thinker? Who's your executor? Who's your process champion? Who's in that thing and define them on the roles which are what I call very critical and important roles and define these very clearly And your organization structure, but it all would start from the leadership If your leadership is not able to take people from their mindset from what they are currently doing and what the future holds It would never happen Fifth point which is the final point is how do you embrace technology technology is no more a choice Every company has to really bring in technology in their system and technology only technology Well implemented can now help companies scale no company I would know at any level Without having a strong technology base could not be different to scale that now technology further has to be divided within the organization At three component level one is called the business intelligence side business intelligence is very very important and today I think the one of the government Guiding force for a growth of any organization or scaling up an organization would be how strong they have the business intelligence Even your future investors if you want to really Compel companies to invest with you You need to really show a very strong business intelligence on that and that's where I like companies like with these technology companies Which have now Technology based even retail organization because they understand every single customer why they purchase what they purchase What they didn't like what they like every single detail and that creates a very strong capability So how does your your investment in technology going to understand your business better? What are the data points every single day you get to yourself which tells you how your organization matrix is working? That's what we call the building the intelligence second is very easy where every person is already I think Indian businesses have come down almost every business. I know Would have some form of you know process management where technology is implemented. It can be a purchase inventory sales You know any kind of marketing function shipping HR Accounting all these are having different technological tools and all that I think is every company is doing a lot of companies are not investing on business intelligence But but process management everybody is doing and third which is also very important Is that how do you create a consumer interface through technology? So I feel the middle part almost every company is trying to invest But they're not investing on the business intelligence and they also not investing on the consumer interface. So if you are looking to scale your business Always start with evaluating your your and planning your entire thing and define your your assessment Map then go to understanding your capital requirement. How do you capitalize the company? Understand your consumer demand break that into four different components Then go to your defining your team structures Especially start with leadership out the leadership is stacked up and and be honest on that. I mean sometimes I see You know, you have your son leading the business And sometimes children come in we all love them and they're fine, but they might lack Capability of scaling up they can do another role They can also participate as a active shareholder and a board member and things of that nature and and run from it And that thing but they might need some strong leader alongside and that's something which Intelligent promoters are always done. They've always understood that There is always the right time for somebody to be at the chair of leadership And that's something which is very important for companies to do and finally Invest into technology divided that into three parts of business intelligence performance management and a consumer interface. So this is what today's Section is and and answer for us to really talk about how the scaling can work with you So I would now invite Sonali if there is some question which I can answer Thank you so much sir for sharing your practical insights and for a wonderful session Yes, we would just jump up to the Q&A Now Yeah, so the first question that we have is which is the best market globally to venture into for scaling up a technology business according to you It's very difficult to say, you know every market is Is a good market for technology technology is not a anymore of Limited to anything the market and depends on you know What product and what services you offer and I think technology is just a enabler It would depend on what industry you are in and then you can classify your fruity markets and not so fruity market and some emerging markets So it's always about industry technology and tools are just the enabler technology and if you are just a technology product itself then I think you have a global market then technology is not limited by any form of geographical space so you can you can be a global play and From a development viewpoint, I think obviously attractive markets are developing nations India and other places where obviously development is very good but marketability and distribution is global and today what we look at, you know Look at what now is coming in the press where Chinese apps have been banned in India And now if you look at people didn't know that how many apps they were using which were actually Chinese They've blocked about 100 of them and they're still hundreds of them out there So so never nobody really thought and we've always to settle that Chinese the manufacturer company and and they had No investment on the and we are a very strong technology company And now suddenly we realize that almost every third app which everybody was using is those a Chinese app So so it's a it's You know companies have no limitation, you know when they understand that there's a global market So they would go out and use the global markets and penetrate to the world markets so Right, so the next question we have is what is the right time to start thinking about franchising a business Is there any specific milestone that should be achieved before the scalar process begins? So franchising, you know, I always say that franchising is Best done when you are able to one assess yourself that you have two things in your in your business model one adequate margins which you can share with the franchisee and the business is still You know sustainable for everybody and second part is equally that you have adaptability of your business model Wherever you want to franchise So if the product is adaptable to that market, then I think franchising is is good and now when you think about putting into franchising there is a pre franchising plan which means that you need to invest into systems and processes And and then venture out into that don't just venture out first develop your internal capabilities and then I think it'll be easy for you to scale it up So the next question we have is while scaling up how to face the challenge of your employees copying your idea And starting off his own and selling to your current or future customers So all I mean they've always the last time I also spoke about this that how does internal competition and external competition Both are have to be looked at and I think You know, you need to really You know Be safeguarding your intellectual property in one sense But there would be obviously there there would be somebody knowing Not as much as you know, but somebody knowing as much in I think it's but it should not bother you It should not bother you because I think competition for success Is a is a is not a bad idea Almost everything which is successful would find a competition and competition Also gives the companies to be always on the toes To continue to understand how they can better their product and better their product by that time You are on the innovation side you're thinking in the front and and continue to focus on your part of innovation and understanding your customer well I think Competition would always be marginalized. I don't see any successful business which is out there Which doesn't have a competition and it's good to have you know, and sometimes like my own company for first So many years. I didn't have a so to say a franchise competition And I used to joke and either the main industry is not so much interesting that nobody wants to come in this industry and Because otherwise if the business was good, then they would there would be a lot of people who would Like to be your competition and by the time you have your own way of innovation and and your own Structure you will you will always kept the leadership. So I think keep leadership in mind And keep your market share in mind Don't bother too much on the competition competition is good competition should have be there Almost every business should have a strong competition and but you should have leadership and and your control over your market share Absolutely And lastly, I would like to ask the question which we get in almost all of our Sessions with you and the question is so is it the right time to borrow loans? Or should I wait for the market to get normalized and And or if should I just look for funding in order to scale up? So equity, uh, so as I said if you if you need capital for for Your scaling up now there is a different Stages of scaling up somebody who needs to scale up is current manufacturing capabilities. The order book is very strong Uh, you already have a very strong order book like these days What happened in fmcg and a couple of other companies? They there was a huge demand came in health care Huge demand came in for some categories So if you have a situation where you clearly have a three to four five year Demand being already there with you and you have a good order book And there is a predictability of what we need to do Then debt is not bad And I think that also comes at that stage much easier because bankers are also able to see through that Where is the entire can say you've got a order from government of india or you are supplier to railways? Or are you doing a metro project or you're doing a large infrastructure project of things of nature? There is a clear predictability of of your Revenues which are earmarked. Uh, then I think debt makes sense Uh, and I I feel that debt can be developed but if you if you are a business which has gestation cycles and you have You know, not so clear at this stage answers of your revenue cycles This is dependent on a lot of what I call Variables available, which means that you're how your performance comes in how the markets behave how the customers shift that happens So if these are variables, then I would say don't take debt And and go for equity and look at a good equity partner who sees your vision And also comes with sharing your risk. So then equity becomes more more, uh, right Structure to do that and I feel that companies which are not determined by a very clearly strong Books available for future sales should always look at equity Right. So with this, we'll just wrap up the q&a round. So thank you so much once again for your wonderful session It's a pleasure Having you every time anything you would like to say in the end Thank you very much. I was taking one question Yes, Arriban. I think your question is that uh, this question is sometimes scaling up past comes at a cost of Compromising unit economics and margins. What is that advice on that? Absolutely The first thing it hits when you start scaling up is is your Efficiencies your efficiencies start going down which sometimes disturb your unit economics and also disturb your margins Say for example, you were doing x now you do x minus this from a throughput from a unit viewpoint While you continue to multiply the units, but your performance is not there. So when you are under your own one store I'm giving from a retailer's simple example You are sitting there your family is sitting there. You obviously would get the best But then you open up a next door. It's not as good as the first one Then the third one and fourth then we can start averaging out. So your unit economics get into that So you need to really balance it out So that you need to really see that you don't erode your margins And this is one of the areas which I found that companies which started good from a scale viewpoint The name in the rush of just scaling up They finished their margins and they didn't know where the economics have completely turned around And and then they start taking the burden of debt to sustain that growth Which you have they've committed and hence they get into a very vicious cycle to do that and then It becomes a very very difficult cycle to come to So scale is a is a very very sensitive You know thing to handle you that's why I keep saying Go scale a little bit take a break consolidate scale consolidate scale So that's how it should be done And and continue to find answers to improve your margins because I I feel that unit economics and margins very very good question is very very important to to continue to keep eye on scaling up otherwise And I've seen so many examples including one of my companies which I invested has disastrous because you know answer for people in scaling up is Throw the product cheap And and then we get into scale. I mean this idea Apple doesn't need from anybody right if apple says You make a phone for 15,000 rupees. You will be able to sell more I don't think anybody needs to hire any strategist for doing it, right? so idea is that What apple did was that every time they had a bigger market share they increased the price Because they they continue to Upgrade their margins and that's why they became the most valuable companies because you know if this was a old strategy of a conventional You know Businesses then idea was let's make it a little more cheaper or get a cheaper phone out there, which is also apple And we will be able to sell more. It will be out selling the chinese But this is this is a business call and they took a call on margins than the Then the you know market share Just picking running My madness on a market share. It doesn't make any sense to me Oh my answer all the questions. There are still a lot of questions available, but I think we've already Passed our time so Hope you like our Are these sessions we do every saturday at three o'clock Every week we take one topic of one time how to invest scale and value Next week would be value again How do you value businesses and how you take them to I think we'll continue to do that And then we'll be giving some examples and structures It to make it more interactive if you can bring in Some questions of yours which you want I can share with you give you some ideas As I say always that in my journey has been I've been fortunate that I've worked with about 4,000 plus plus companies in advisory role And I've seen a lot of success, but I've seen more failures So I can tell you a lot of things not to do then actually to do So if you have questions for me and my own company has also seen ups and downs So every businesses has own own life cycles So we we need to really share and these times every entrepreneur should Really encourage to how much we can share with each other And more we share with each other we have collective learning and we can learn from each other and And do good to our enterprises Thank you very much. Thanks for your time today and thanks for joining in for today's webinar Thank you so much, sir