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Dr. Venkat Devarajan, a respected professor in the Electrical Engg. at UTA, is more than just that. He is also the President of a startup company, Imagecom Inc. IMACS got together with Dr. Devarajan for an informal talk about the basics of starting an internet company. We present here a few excerpts from that conversation.
Q. Do you consider Imagecom Inc. a regular dot com company?
A. Speaking in general I guess we are. But to be more specific we are more than a dot com. We are an Application Service Provider (ASP). So we are a Dot Com with In depth technology.
Q. Is ASP very different from a dot com?
A. Yes, they can be. Many dot coms just act as a vendor or the middle man for products that you can obtain at a brick and mortar store. An ASP is a little different. We provide a use-as-you-need service in the pay-per-use mode where customers use our software for a small price. They save on the cost of purchasing software and then for its upgrades and maintenance down the line, the training. This model may not work with all software but for our software it works well.
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Q. Will ASPs survive as it is redefining business models?
A. We definitely hope it will as it makes sense in some circumstances - when the software in question is expensive, the technology is continuously maturing, the customers don't need it ALL the time, the market is global etc.. B2C has not lived up to its hype. The jury is still out on B2B.
(Hoping we have provided a little background for technicalities I asked Dr. Devarajan to give a few suggestions for budding entrepreneurs among the IMACSians)
Most important is to have a good idea. When we began with ASPire3D.com we
Knew that we had a good idea. We had a software that no one had thought possible. So a good and credible idea that solves a real problem the is first and foremost need for an entrepreneur. Secondly, you have to have a business plan. Finally, you need someone to finance your business such as a Venture Capitalist (VC). Some prefer to go the bootstrap way and pay with the revenues generated through their product, but I would not recommend this approach except in special circumstances. I would recommend for the first timers to try the VC route and get a small
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piece of the eventually larger pie.
This next advice is a general one and does not apply only to startups. Don't ever be discouraged by failure as luck may not favor all your ventures. But the lesson to be learnt is definitely worth the failure (and I don't even like to call it failure). Take for example my classmate, Gururaj Deshpande, who has had the fortune to have a flood of successful startups. He has had four startups and of those except for the first one the rest have turned out to be huge successes. Many entrepreneurs go through 3 to 4 startups in 10-15 years. Even if one of them clicks they succeed. VCs expect to make 20 times the principal amount in a matter of 3 years. That is huge.
My advice to students is to take the initiative, get together and discuss product idea An idea is all they need to put into action their business plan. I would be happy to help students with their business plans. And another thing to remember is to protect your intellectual property. Simply working in a startup as a key employee (as against starting one by yourself) can also be an intellectually and financially rewarding experience.
(as told to Ganeshram Iyer)
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