Jai Shekhawat left McKinsey & Company to start his own firm. His friends needled him about leaving a job at the prestigious consulting firm, pointing out that he had a new child.

Shekhawat’s peace of mind was disrupted by late night mulling—not over his soon-to-be-former job at McKinsey, but by the half formed business plans playing around in his mind.

Every time someone questioned him on the risk he was about to take he reminded himself that entrepreneurs were made, not born. “I took time during a trip to India to think about the risks that an entrepreneur faces and tried to categorize them. I came up with four types of risks—financial, career, social and psychological. Once I was comfortable with my personal risk profile, I was ready to face the rigors of starting a business,” he says.

The entrepreneurial journey for Shekhawat began in the birthing room at Edward Hospital in Naperville, a suburb of Chicago. While visiting his newborn son at the hospital, good friend Udai Kumar approached him with an idea for a company. Things developed quickly and IT20 (now known as Quinnox following a merger), an application outsourcing company, was established within months.

Another close friend, Anil Kumar, soon joined as a co-founder. While the business grew, Shekhawat and his partners sensed another market opportunity in providing a platform to help large customers improve their buying of services from their suppliers. Maintaining a seat on the board of Quinnox, Shekhawat left the company to start Fieldglass in 2000. His partners took board seats in Fieldglass and Kumar provided the seed investment.

“This was an opportunistic move and we went with our instincts,” says Shekhawat, adding, “our goal was to maximize the bandwidth that three of us could provide to these two companies.”

Hold a mirror to yourself
While Quinnox was a self-funded company, Fieldglass was venture-backed. While other players had attempted to solve this problem, InSite was the first, vendor neutral platform, that took a supply chain view of the services procurement problem. Many other solutions had tried to disintermediate the supplier. As the firm was established, there were immediate issues—the staffing firms fought back, the bottom had dropped out of the venture market, building a solid team was time consuming. “The worst was that the enterprise buyer we were targeting didn’t want to hear about any more e-commerce solutions,” says Shekhawat, CEO and co-founder.

“It became all about execution – building great product, closing deals and raising venture money,” he says. “We raised $10 million in 2000 and another $17 million in 2002, one of the hardest periods in recent memory for raising venture capital”.

Today Fieldglass is a fast growing five year-old firm, with $10 million in revenue and $38 million in venture funding. They are still largely focused on their original vision, but Shekhawat thinks that the path of growth for any company is filled with minefields. “As a company grows, the big challenge that you face is to make sure you have the right set of skills for every stage of your growth. This requires a lot of discipline and a willingness to tolerate short term disruptions.” Shekhawat advises frequent, critical assessments of the company in conjunction with close outside advisors and board members. “Our board has been very helpful in getting us think through these issues,” he says.

To keep ones ideas fresh, Shekhawat argues for the importance of intellectual integrity around ones thinking—showing a willingness to expose your ideas to the criticism of colleagues at every level. “Time is always short when you’re building a company and this keeps you from drinking your own Kool Aid and ending up down a dead-end path,” he says.

Shekhawat thinks that one of the most important roles a board can play is to constantly hold up a mirror to the business to show you what you really look like. Management must build a list of market indicators and measurements that tell you how fast you are going, what resources you will need and exactly where you are at all points in time.
But doesn’t being intellectually honest also entail being factual? Shekhawat concurs. “Before you start your company, at least one aspect of the fact base—your odds of success—are against you. You would never get going if you didn’t question the facts to some extent. Last time I checked, the world wasn’t looking for another startup. So to run a company in spite of these odds, one needs to be a dreamer or at least be able to see an alternate view of the world.”

Dependency comes with Independence
Dreaming to some degree also means evangelizing as you try to get a reluctant marketplace to buy into your view of the world. This helps the company as well as the broader market evolve. Shekhawat explains how difficult this can be, “When we launched our product, the market never came to us asking for this solution. We had to find the visionaries within our target customer base and convince them that there was a better way to engaging with their service providers.”

Entrepreneurs need stamina and the ability to rejuvenate. Things that were exciting will eventually become routine. The selling of the vision will give way to daily blocking and tackling—setting up a sales force, putting performance criteria in place, building a finance department, scaling product development and so on. The shift from evangelizing to execution is a critical transitional period for a young company and will be the first test of the long-term viability of the firm.

Power of an Idea
Shekhawat believes that right time to start a company is when you feel passionate about an idea in an area where you have some specific expertise. “You should feel a powerful dissatisfaction with the status quo,” he says, adding, “Ideas that are pursued primarily for money seldom make it. The power of the idea will sustain the entrepreneur through the roller coaster ride of a startup.”