The Genesis of Livewell

Subodh was excited.

After many years of struggle, his fledgling company, Livewell.com, had successfully closed a sizable funding round. They finally had enough cash to implement some of his ideas.

Subodh grew up in a small town in Punjab in a family of traders. The youngest of five children, he was left largely to himself, and found that he liked it. He took to books at an early age and to maths soon after. His academic prowess was soon the talk of the village and later of the nearby town. After completing school, he took the competitive exam for admission to IIT and, to no one’s surprise, did very well and chose to study Computer Science in Delhi.

IIT was a shock for Subodh. From being the brightest person in his school and the teacher’s pet, he found himself struggling to keep up. To add to his misery, he did not like hostel food and started losing weight. He had always been healthy, but in his first term he missed nearly two weeks of classes due to illness.

From his second term onwards, he added personal health to his regular academic goals. He ate well, started to exercise, and monitored everything through apps. He met Ankit during an early morning jog, and strangely enough they became friends. It was strange because Ankit was the antithesis of Subodh in many ways. He grew up in Mumbai, was charming and outgoing, and was captain of the school cricket team with national honours in swimming. He could do anything he wanted, and he had joined IIT because he could, and because a friend dared him.

Fitness brought Subodh and Ankit together. Sometime in their third year, they decided to build a fitness app that was better than anything else in the market. They soon realized they needed sensors to build anything more than a basic app. They roped in Supriya, who was an electronics whiz. She put together a band with sensors that could track a whole range of body functions including motion, heartbeat, location, sweat, and blood pressure.

Their project was selected to represent IIT at a premier tech event, and they won. After returning from the competition, the three of them met to decide if they wanted to continue working on the app. Supriya did not see this as a major goal and wanted to pursue further studies in the United States. She was, however, prepared to help for a while. Ankit and Subodh wanted to see if they could take the app further.

They decided to extend the idea to more for than just fitness enthusiasts. Over their next two terms, they enhanced both the product and the idea. The band was now paired with an app that used all the collected information to provide advanced analytics. This information could be available to both the person with the band and to healthcare professionals. It was significantly more advanced than other similar health wearables. They decided to call their company and their product Livewell.

They joined an accelerator immediately after graduation, and within six months had active interest from several seed investors. They were one of the lucky few who were able to select the investors they wanted. They were able to hire a great team and build out their product. They moved into a nice co-working space with flexibility to grow as they wanted. It was a fairy-tale beginning.

The challenges started about six months into their first year, after they got their seed investment. Supriya felt the main challenge was over and she left to pursue her master’s degree. The initial prototype was bulky, and they worked with a Chinese IoT manufacturer to improve their device. The first lot looked great, but the sensors did not work as expected. Ankit moved to China for two months to find a better manufacturer. They had hoped to release the product within a year of funding. It took another six months till they finally got it out.

By then, they had run out of money. They had to move out of their office and into an apartment, and they had let go most of their team. They borrowed money from friends to pay salaries. Fortunately, one of their investors provided additional funding to get the first batch of a thousand pieces developed and delivered. Since they had no money for marketing, Subodh started meeting doctors with the device and the data. After what seemed like a million trials, one of the doctors, Dr Kamini Bhat, was excited enough to recommend Livewell to her patients.

Subodh and Ankit were now both meeting investors and trying to raise the next round of funding. Since the product had very few active customers, this turned out to be a nightmare. While in their earlier round, seed investors were lining up to invest, now there was simply no interest.

And then a miracle happened. One of Kamini’s patients was a senior partner in a VC firm. He loved the product, and invited Subodh and Ankit over for dinner. Within a month, they had been approved for enough cash infusion to get them going. There were of course many conditions, and it was a significant dilution of equity. But the sun was shining again. They set up a new office and were lucky to get back some of the people who had left.

They hired a marketing team as well. Their social media presence started to grow, and a few stores started to carry their product. They put it on all the major marketplaces as well. Their newly hired technology team had significantly improved the look and functionality of the product. Their manufacturing was now reliable. Their new investor helped them file a slew of patents to make their approach defensible. Their board was expanded to include Kamini Bhat and a new investor nominee, Kriti Rao.

Sales started to rise. Device sales increased each quarter. They were now midway through their third year and were being talked about as one of the start-ups that could disrupt the wearable market. Subodh, Ankit, Kriti, and Kamini would meet every month to review what they had achieved and to plan for the next month.

During one of the meetings, the discussion turned to the future. “We know we are doing well right now,” said Ankit, “but how do we ensure we stay ahead? There will always be something newer, and as technology continues to evolve, we need to be ahead of everyone else. What works today, may not work tomorrow.”

“It’s more than just that,” said Subodh. “Today, we are doing a lot of the thinking for the business. But as we grow, and I am hoping we grow a lot more, our entire company needs to be ready to quickly adapt to changes. We have to expand our leadership team and share decision-making.”

Kriti nodded. “It’s great that you are thinking about this and wanting to reliably scale your business. As you start to scale, you need an organization that has clarity of purpose and can respond quickly when it needs to. I know a person, Javed Ali, who can help you put together some of the elements that will help.”

Subodh looked uncertain. “I like the idea. But it seems like a lot of work to take on right now.”

Kriti smiled. “I think you will find that it is best to have some of this set up as early as possible. As the company grows, it will become harder to make it flexible. It should also take some pressure off from the two of you. It will take some of your time to implement, but you do not need to do it all at once. If you are clear about what you want, you can decide when and how fast you want to do it.”

“That makes sense,” said Subodh. “We should meet Javed.”

Both Subodh and Kamini nodded. Kriti agreed to connect Javed with Subodh and Ankit.

Subodh and Ankit invited Javed to meet them over the next week. Javed was an older man and seemed to have done everything. He had grown companies as a CEO, had acquired and integrated companies, done three start-ups, and was on the board of an impact fund. He had even started a fund himself.

He was quiet, unassuming, and asked a lot of questions. He took the time to understand their business and was able to give examples of other businesses similar to Livewell’s. He explained his approach, and both Ankit and Subodh felt he would be the right person to help them. Ankit suggested that they invite Kriti and Kamini for their next meeting. Javed agreed and asked for information about the company to prepare better for the meeting.

After introducing Javed to Kamini, Subodh asked Javed to take over.

“It’s clear that you want to be able to scale. Before I try and provide a way of looking at this, I would like to understand what you think is the most important attribute for scale,” Javed said, “Can each of you write down your reason for wanting this?”

Kamini nodded. “How many attributes can I write? I can think of several.”

“Just one,” said Javed. “If you can think of several, pick the one most important to you.”

After a few minutes, everyone had their reasons written down.

Kamini went first. “I think the key element is the culture of the organization. If every Livewell employee wants us to succeed, we will.”

Subodh said, “My key attribute adds to Kamini’s thought. I think we will be best able to scale if every employee can contribute their ideas and then execute them.”

Ankit said, “I think we will be able to scale if at any time we focus on a few things and do them very well.”

Everyone now looked towards Kriti, who hesitated. “My bigger problem is that I am not clear about where we are headed. Once we know that, it would be good to be clear about how we will get there.”

Javed had been taking notes while the others were speaking. “This is wonderful. Between the four of you, you have very clearly articulated the key attributes required for scale.” He went to the whiteboard and drew a diagram.

Javed continued, “Together you have identified all four levers for scaling Livewell. Put simply, these levers allow you to grow while adapting to the changing industry and customer requirements. These are the levers you control. What you do with the levers depends on your industry, competition, customer preferences and, most importantly, access to capital.”

“This seems simple enough,” said Kamini. “How does this address everything we mentioned?”

Javed smiled and looked at his notes. “Let’s start with Kriti. She wanted to know where Livewell is headed and how to get there. That is our Strategic Direction. We will define our purpose and goal through our Vision and Mission. We will then outline our Core Strategy, which is the broad how of getting where we want to go.

Ankit wanted a few focus areas which could change easily. Those are Breakthrough Initiatives. We will identify objectives and programs to focus on and will represent them in a ‘Strategy Matrix’.

Subodh asked for a transparent method to have everyone contribute ideas and execute them on a near-continuous basis. You can do that through setting up a company-wide Management Process.

Finally, Kamini spoke about a culture where people want to, and can, contribute to the company. Here we will set up our values as well as a process to build people competencies on an ongoing basis. We will use practices and policies to build trust, so that employees want to participate in our continued success.”

“That became heavy very quickly,” said Subodh. “I am guessing each of these will need a lot of work. Is there a sequence we should follow?”

“Not really. You should have clarity on your purpose and direction first, but the rest depends on what your challenges are at that time. These are organization-wide processes, and it will take some time and effort to implement all of them. It’s a good idea to do them one at a time,” said Javed.

Ankit nodded. “I like this framework and believe it will help us scale more effectively. If we can respond faster than our competitors, it will be a huge advantage. And if we can take everyone along, Livewell will become a wonderful place to work as well.”

“I couldn’t have put it better myself,” said Javed. “Many things go into making your company a success. Your strategy, the industry, understanding the pulse of the customer, having the right people and the right technology—everything matters. Occasionally it is luck or timing, and often its money. The four levers help you use your resources most effectively to respond to market changes while doing what is required to grow.”

Subodh said, “Well Javed, you have convinced us. Let’s get started with the first part of your framework and take it from there. Ankit, you and I can have a more detailed session in our office, and perhaps meet again after two weeks?”

Everyone nodded.

SECTION 1

Strategic Direction:
Where Are You Going?

One day Alice came to a fork in the road and saw a Chershire cat in a tree.

“Which road do I take?”, she asked.

“Where do you want to go?”, Was his response.

“I don’t know”, Alice answered.

“Then”, said the cat, “it doesn’t matter”.

– Lewis Carroll,

Alice’s Adventures in Wonderland

Prologue: Where Are You Going?

A week after their first meeting, Javed met Ankit and Subodh at the Livewell office and explained his process. He planned to facilitate the process, and not prescribe a solution. In order to do that, he would need to understand the company better so that he would know the context better and could share examples and experiences that were relevant.

Ankit and Subodh both felt this would be better than a more prescriptive approach.

Javed spent the next few days reviewing all the public information available about Livewell. He also asked Subodh to share Livewell’s history, financial performance and plans. He met with the product and marketing teams to better understand the product, the industry and Livewell’s customers. He completed all this in the two weeks prior to the next meeting of the core team.