The new generation in societies lacking a corporate world mostly try to find jobs in the government. With life expectancy improved, a generation of people has started their new careers post-retirement as they have experience and resources. Now a new flock of entrepreneurs is emerging who leave the government jobs in the middle of their careers to experiment elsewhere. In this interview, Kashmir Life talked to Shabir Ahmad Handoo, a former Assistant Commissioner in Income Tax who has launched his own Angel network.
KASHMIR LIFE (KL): Income Tax department is resourceful, offering a lot of experience and exposure. What forced you to quit a lucrative government job in the middle of your career?
SHABIR AHMAD HANDOO (SAH): It was already in my mind that the day I will get a new idea about what I must do now, I will say goodbye to my government job. I had already decided that the remaining period of productive tenure I would utilize to help my new idea to grow. So once I got the idea about what I must do, I decided to invest the six-seven years of my productive age into the new idea. So I decided to join the corporate sector so that I could work practically on my ideas. The fact is that at the age of retirement, the energy level is low and major ideas are difficult to be managed.
KL: People live life in circles, one completes only to pave way for another circle to start. One of my friends who is 80 and still serving in a major position never found time to construct a home in Srinagar, the city of his birth that he left at 17. He was never permitted by his experiments to spare time to own a home. By the way, what is the experiment you are going to do?
SAH: I served the Income Tax department for almost 30 years and enjoyed quasi-judicial authority. My motive for quitting the job was to explore the life that existed on the other side of the table I used to sit. Many suggested I remain the taxation advisor as I have the complete knowledge and understanding of the job. I thought if I do it, it will keep me around the same table I already had with more power, responsibility and authority.
After a lot of discussion and brainstorming within the friend circle, I came to the conclusion that we must do such a thing that can develop creativity in a business environment and intervene as a positive disruption. This was important because people in this part of the world study to have a government job because it offers some comfort zone. Now the government jobs are less and highly competitive.
We intended to build a platform where people will be connected for the exchange of ideas, services and investments. We intended to contribute to a new entrepreneurial eco-system in which different people have diverse roles – investors, entrepreneurs, and a lot of people who deliver at various spots in an initiative’s forward and backward linkages. These roles people knew but were never introduced formally.
So, we set up a platform, a company, Kashmir Angels Private Limited, which is registered with the Ministry of Corporate Affairs (MCA). This is basically a network where we connect all business-related resources on a single platform. It has been less than a year. We have succeeded in getting some attention and we are getting a foothold in different sectors wherever we are inclined to. The process of onboarding has started and we are also connecting with subject experts. Well-meaning, very energetic, and subject-oriented people are connected with this initiative. We have onboarded at least two start-ups as of now.
KL: How can your company help the young generation in future?
SAH: We want those people who actually have new business ideas, who can identify the business gap in the existing business eco-system for their interventions. We want either a completely new idea that has hitherto been ignored or some niche area in the existing business ecosystem where we can help a start-up. We do not want copies because people trying to emulate successful stories have no idea about what the promoter is doing to keep his success going on. A copier lacks access to that information.
We will help aspirants from the very first stage in ideation and later in the implementation. People are not aware of the new sectors like solid waste management, alternative energy, and alternative financing. They will have to explore all these sectors to identify the gap where they can intervene. For that, they need research which we provide. So the candidates will come to us either with direct ideas or will have to identify the sectors they are comfortable with. We will help them focus on the specific area within the sector where they wish to plan their business. Later, we will arrange their finances by connecting investors but it depends on how powerful the idea is and how disruptive is it in the prevailing eco-system so that it gets a lot of attention and acceptability. We will also help in branding and registration and creating a financial model. Why we are doing all this is to help the start-ups in managing all this under one platform. We will work with the start-ups till they reach the breakeven point.
KL: There are no free lunches. Are you going to partner with the new entrepreneur or are you taking a fixed fee? There are similar systems within the governance structure, how you are different from them?
SAH: Whatever systems exist, do their job within their domain. The fact is that there are more than 6500 registered start-ups on paper. But we have not seen any one of these units, scaling up, like Unicorn, in this part of the country. If there is no growth in the startup ecosystem in this part of the country, there is something that is lacking. There are some hurdles and impediments, which need to be removed. There are two to three success stories on this front and they are too few. These successes were also supported by Angel Networks, from other parts of the country.
Yes, it is not free. We have a standard procedure in angel networking and we also follow the same principle. We accept only corporate, private limited companies that have a shareholding structure, of which we will take a small portion of the shares as our fee. When shares are created, we will take a small number of shares as our fee against the service we provide. It will be advisory shareholding that can be one to two per cent or even more up to five per cent which is based on the quantum of funds that it requires. No upfront fee is to be paid. It is always negotiable and it is a win-win situation for both sides. We will be advising the company on a long-term basis including about how the funds will be raised and the quantum of shares that the initiator must sell to the investors and retain the larger portion of the shareholding with him.
KL: We push people into start-ups without offering them an idea about whether or not it has viability on basis of raw material, market and manufacturing and management mechanisms. You are starting from two entrepreneurs, what will they do, given the restrictions that the market imposes?
SAH: That is precisely why I said that we will discourage copy ideas and would prefer original ideas in which the initiator has worked on all the key factors that will decide the viability of his idea. We would not initiate any business the beginning of which will mark its end.
The most important thing is to identify the business gap. Once identified, you can identify your position and figures. So that is why we need to have original ideas supported by research. There is no such culture of research in Kashmir and that is why we are offering this to the potential start-ups. It depends on market research. The more research will be done the more gaps will be identified.
The intervention of authorities is important as well and we need coordination there as well. In our case, it is clear if you don’t have market research then you can’t come up with a scalable business idea. Moeover all such ideas need to be tech-based. We have taken up a startup in the agriculture sector which is about integrated farming and is tech-based. You must understand that only tech-based ideas have a future and only in those can we have growth in future. This unit has horticulture, sheep farming and other activities on a vast swath of land. Its financial model, statutory compliances and marketing are being managed by us. By all standards, we see it as a promising unit. The other unit is in the health sector in which the basic spade work is done. It is also a good project.
Our work is basically providing an enabling platform where people meet people, experts meet entrepreneurs and entrepreneurs meet investors. So, if that platform is created to its optimum potential then things will start moving ahead.
There are some new projects that have approached us and we are in the process of evaluating them. We are interested in waste management. People must know that some of the biggest companies have no real assets but still are big. Some of them perhaps have no offices at all.
KL: What are the challenges you see for your initiative?
SAH: Making people understand how Angel networks run is itself a big challenge. People in this part of the country are not aware of how these things work. People here believe that if the bank rejects a funding proposal, it marks the end of the idea. The fact is that banking is just one way of managing resources. There are people willing and ready to invest. It will take some time for the people to understand it here.
(Shakir Ashraf processed the interview)