Lessons from an entrepreneur – Omak Technologies
It’s common knowledge that being successful in business calls for perseverance, hard work and being nimble, mainly on the part of the founder. But there is no set formula to achieve success, as no two startups will ever be the same. Echelon spoke to three entrepreneurs whose brands have achieved market leader positions on what it takes to win at the startup game and their tips for budding founders. Also featured is a business leader that made a daring decision to leave the comforts of corporate life to realize a greater vision.
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Omak Technologies restaurant management software’s Sri Lanka market leadership wasn’t a grand enough goal. The five-year-old firm has since successfully launched in Indonesia, South-East Asia’s most populous country. Without growth, you don’t attract funding; then it’s tough to sustain the business, which leads you to either reduce staff or costs; but then the operation becomes unviable and you will lose customers. “It’s a vicious cycle,” Omak Co-Founder and Director Ehantha Sirisena says.
Learning from Omak’s mistakes and celebrating its successes, Sirisena shares the company’s lessons learnt to help foster the next generation of entrepreneurs.
A startup isn’t a startup unless it’s growing fast
● “How many companies launched following hackathons and startup competitions still exist?” asks Sirisena.
It’s a misconception that a new company or one applying technology or has venture funding is a startup. Rather, a startup is a company designed to grow fast. This is the only way it can be sustainable.
“We target 20% month on month growth,” he says, which is possible given that Sri Lanka is a small market and Omak was lucky to launch during the dawn of the local startup eco system. Today, most startups securing funding don’t see this type of growth, and shut down after burning through the initial investment. Sustainability also depends on a founder’s ability to understand evolving investor fads. “In the startup world, this is called the ‘flavour of the year’.
Last year, artificial intelligence was the big global trend, “so our investor pitches incorporated this flavor, which was restaurant tech with AI”, he explains. Startups must be nimble enough to adapt to changes, but many fail to do this. That’s when they lose traction and investor interest.
Funding opens doors to the world
● Lack of funding can spell doom for startups, as even great ideas require funds to put plans into action. So, in addition to a working model, you also need to attract the right investors to see your potential, he advises.
“It cost Rs30 million to launch Omak in Indonesia. If not for the Lanka Angel Network and Venture Engine who supported us with deep pockets, we could not have done it,” says Sirisena.
“Unless you can sustain yourself and achieve scale, Sri Lanka is too small. You need to diversify and open new revenue streams,” he adds. And if Omak’s learning is anything to go by, significant funds are vital for expansion.
Omak’s latest funding came from BOV Capital, a Singapore-based fund focused on Sri Lankan technological ventures and whose investment of around $1 million is earmarked for aggressive expansion across South- East Asia.
Customer is not always king
● Omak expanded to Indonesia in early 2015. It’s biggest lesson in the country was that Indonesian customers are very different to their Sri Lankan counterparts. “As a newcomer to the market, we gave into everything they requested, and then struggled to get back on track,” he says. It took the company a year and half to realign itself with its strategy in the country.
“When you are a fresher, your first customer will grab you and pull you in the direction they want. Then, it’s only a matter of time before you start doing things his way rather than what best practices in the industry dictate,” Sirisena cautions. Customisations are necessary, but know the extent you are willing to go. Sirisena advises to target the least mature market, so you have a superior product and can gain traction. “We have local competitors in Indonesia, but our feature list is far greater,” he adds, which will help the company pitch itself higher in the future.
Keep the pipeline active
● In 2016, Omak tried its hand at four more countries – Singapore, Malaysia, Australia and India. “We ended up burning ourselves,” he laughs. He advises to focus on one country at a time, given the funding required to set up operations. But, he says, the pipeline is as important as the present.
“I’ve realised that we need to keep a close eye on the pipeline and make sure it’s active.” Sirisena relies a lot on his local team, headed by Chrishan Perera (Director of Marketing and Strategy/Chief Executive) and Nadeesha De Silva (Head of
Product), to keep the ball rolling.
Know when you are not the smartest guy in the room
● Sirisena lives by the phrase ‘Never assume that you know more than everyone else’ and readily admits that all his top hires are “much smarter than me”. The best hires are those that can add value to the company, he says. “You also need to know when you are not needed sometimes, or where you are not adding value, and take a step back,” he adds.
He also credits Omak’s board. “Once you attract investors, it’s not your own company anymore. As young entrepreneurs, you will need someone to guide you, tell you when you are wrong and discipline you. This is where our board was of immense value,” he explains. Having people hold you accountable will give you a different perception.