Naeem Zafar: Entrepreneurship for the Better World

Editor’s Note: Naeem Zafar is the president and CEO of Bitzer Mobile, a company that simplifies enterprise mobility. On November 15, 2013 Oracle announced it has acquired Bitzer Mobile. As a member of the faculty of the Haas Business School at the University of California Berkeley, he teaches Entrepreneurship and Innovation in the MBA program. He is the founder of Startup-Advisor, which focuses on educating and advising entrepreneurs on all aspects of starting and running a company. His entrepreneurial experience includes working directly with six startups, and he has extensive experience in mentoring and coaching founders and CEOs.

Mr. Zafar holds a Bachelor of Science degree in electrical engineering from Brown University (magna cum laude), Rhode Island, and a master’s degree in electrical engineering from the University of Minnesota. He is a charter member of TiE .He is also a charter member of OPEN where he serves as the Board member.

You can read his full bio from here, here and here.

eTalk’s Niaz Uddin has interviewed Naeem Zafar recently to gain his ideas and insights about StartUp, social business and entrepreneurship for better world which is given below.

Q: You’re a successful entrepreneur. As a member of faculty of the Haas Business School at UC Berkeley, you teach entrepreneurship and innovation in the MBA program. At the beginning of our interview can you please tell us what exactly is entrepreneurship?

A: Entrepreneurship is a state of mind. It is a way to look at a situation and see how could you make a profitable venture out of it. It is very innate. People, educated or not in urban or rural setting, are just as likely to spot an opportunity and drive it to commercialization.  The likelihood is there just as it is for a Silicon Valley hotshot startup guy. So it transcends all boundaries of education, race and gender. It is a state of mind.

Q: You believe that entrepreneurship can be a powerful tool to alleviate poverty and extremism of the world and social businesses can fill the gap where public institutions often fall short. Can you please tell us more about that?

A: If you think about the definition of a business….its objective is to maximize shareholder return. So the shareholder who invests in the company has an expectation that the management should do whatever it can to maximize return; that is perfectly fine. We have seen tremendous companies and innovation come out of that model. But if there were a concept of setting up a company with the sole purpose of not  maximizing shareholders return but to address its social ill….. that can work for alleviating poverty.

It can be something as simple as the city doing lousy job of collecting garbage. Let’s say the garbage is not being collected on time which is very unpleasant as we know. We can set up a company so that there speedy pick up and disposal of garbage. The purpose of that company is to address this social ill. It is not to maximize shareholder profit. Imagine setting up the company with that objective and shareholders putting in money. This company’s objective is for this social ill to be addressed and not to maximize profit. Now, it is still a for profit company. It still pays market wages and hires the best people to address the issue but it is not trying to maximize profit.

This model which can be very rewarding for the shareholders as it is a new way of looking at solving many of the problems which governments are not well suited to solve. That’s called social business. I think the concept is a powerful one. It’s put forward by the Nobel laureate, Muhammad Yunus, in his 3rd book and I think it is a tremendous way for communities to organize and address issues which plagued them without having to wait for government to show up.

Q: How do you connect these three dots: social entrepreneurship, alleviating poverty and making a better world?

A: If you look at my previous answer I just connected the three dots for you.  Making a better world is about alleviating poverty and giving people a chance to participate in economic growth and well-being. Social businesses and entrepreneurship is a way for them to have that opportunity.

In the country that I grew up in you look for government to give you a good job. However, the government is not well equipped to provide a job for everybody. On the other hand, the private sector is well positioned. As we have seen in US, the private sector produced even submarines, bombs and fighter jets. This was quite shocking to me when I came to this country.

The government’s job is not to produce goods. Its job is to set policies and systems so that companies and entrepreneurs can thrive.

Q: How did you find the idea for Bitzer Mobile? Can you please briefly tell us about Bitzer Mobile?

A: Bitzer Mobile’s technical founder, Ali Ahmed, was working as a software architect for large companies in insurance and oil verticals for many years. He continued to recognize that people were struggling to allow employees mobile access to data.

Ali was having to solve the problem for every company in a unique way. So the idea was, why not come up with the way so that the employees can easily and securely access corporate data and be productive from wherever they happen to be. And that gave birth to Bitzer.

Q: As far as I believe for changing the world, we need to find complex, interesting  and  big problems of the world and then have to build great organizations that will sustain in the long run to keep solving those problems as well as to keep contributing for the betterment of the mother earth. Can you please tell us how can we find interesting, complex and big problems of this world?

A: First of all, I don’t agree with your definition. It is not about solving big problems. It is about solving problems. Problems of all sizes. Sometimes all you have to do is look around you. There are problems in your community, where you live, where you work. Solve those problems. Big ideas come from people trying to solve small problems which turn into great movements. So looking for the great problems to solve is not the only way and may not be most efficient way to do it either.

Q: What are your suggestions on finding interesting ideas and bringing the ideas to life to solve?

A: Interesting ideas to solve come from deep domain knowledge. It’s very difficult for entrepreneurs when they are young to come up with ideas as they can be light weight. The average age of an entrepreneur in America is 37. This means that many people are older than 37 when they start their company. So only if you worked in the industry for 5-10 years you really understand what issues are, what the problems are, and then you can see how you can solve them. So my advice is:  look around you, work in some industry, learn the hard skills. Then you will see the problem and you will be well equipped to solve them. This is how you address this issue.

Q: What are your takes on finding the right business model and identifying early customers?

A: To find the right business model and early customers is simple. You should be able to answer these two fundamental questions: what problem are you solving and who has this problem.  If you cannot concisely answer these two questions you don’t have clarity in your head. I insist that people should talk to 5 to 10 actual users and buyers of whatever product they’re planning to buy and try to understand what their pain is. If you cannot clearly articulate what pain your customers have do not start the company. Then discuss with customers what you are planning to do and if this would be interested in it. If you cannot generate this early customer interest, do not start the company.

And stop worrying about confidentiality. People have other problems to solve in their lives. They are not running to copy your idea. It is the execution of your idea that is the hard part. By bouncing these ideas off suitable customers and users and consistently getting positive feedback, you may be in a position to start the company and then they likely will buy it. Everything else will clarify itself during the course of this process.

Q: Can you please tell us about the legal process of starting a company?

A: Legal process depends on in which country you are starting the company in, what the local regulations are.  My book which is a legal guide for entrepreneurs goes into fair amount of details: What is the process, what options you have in the United States. So read the book. It’s available at naeemzafar.com.

Q: As you’ve seen during Internet bubble, there were so many companies founded and were committed to change the world. But with the changes of time around 90% of them got obsolete. And we ended up having some great companies. Now, there are also so many startups working with cloud computing, big data, wearable technologies, space, robotics and so on. The data shows most of them will also get obsolete as the success rate of startups is very low. But there are always some common characteristics, values,  philosophies and ideas that  keep some startups alive and helps to sustain in the long run. You have profound experience of seeing all the trends as you have been advising companies and working with great entrepreneurs in Silicon Valley. What are your suggestions on building the next big organization?

A: Aspect of building the next big organization is about solving a big problem. It is easy to spot what are the problems that need to be solved. All the trends you mention have tremendous potential.

Big data and business analytics can pinpoint precisely if you put a restaurant in the corner of this street and that street. They tell you what will be your monthly sales when you put it in the corner of that street and that street. So, the way businesses will be making decision could be based on not intuition but actual data.

If you read the book or watch the movie called Moneyball, it is about applying statistics to baseball. It is about how a mediocre team became the number one team by using big data. And that is applicable to every single business. So look for a big idea around you and build a great team with high caliber people. If you can put together a right market with the right team, you can build a lasting company too.

Q: How do you think about hiring remarkable people and let them scope to work on achieving vision that will change our world for good?

A: I think it’s good idea to hire remarkable people. You should do that. It’s not easy to do that. Remember the good people  will follow somebody which they can respect and whose vision they share. If you don’t have the passion and vision yourself why would A people, A players, best players follow you. Best players want to follow someone that they believe in. If you have that you shall attract the right team. And yes, you will be able to do great things. So step up to the stage and stage could be yours.

Q:  Whenever we talk about changing the world, thing that always comes first is changing ourselves. After changing our own life, we can go and change our family, then our society and then our country and then we can have a mission of changing the world to make it a better place to live in. But changing the world is hard, complex, challenging and hurting. You have come a long way and have already left a body of works to make this  world a bit more special. Can you please tell us about what your life has thought you in this amazing journey?

A: What my life has taught me is that it’s not a sprint. It is a marathon. So you have to create your own brand. You have to be genuine and honest and people will follow you . If you have  a vision that attracts people, you will have easy time attracting them.

So my advice to myself and other people around me is that if you’re a genuine person and a truthful person and you have a strong vision and can articulate it, you will have people willing to follow you. Once you have people willing to follow you then there is no challenge you cannot take tackle, no matter how big it is.

You will be able to overcome it over time and there are plenty of problems to follow around the world. But be true to yourself and always look for the team who is willing to follow you.

Q:  Last but not least, can you please give some advice to entrepreneurs who are on the mission of changing the world?

A: Changing the world is important and changing the world sometimes happens. But that is not the goal to start with. It is too big goal. It is too audacious and maybe even too arrogant to have this goal.

Martin Luther King did not have the goal of changing the world. He was just trying to change some laws so that black people could have equal rights. When Steve Jobs was starting Apple he wanted to do a music iPod. He was not trying to change the world. So I’m a little bit suspicious of your question because changing the world has come up multiple times.  Forget about changing the world. Do something meaningful for the people around you and your community. If you’re lucky enough it will have a big impact.  So think more practical and try to make local change. Stop worrying about changing the world – that will come later if you’re so lucky.

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Further Reading:

1. Peter Klein on Entrepreneurship, Economics and Education

2. Derek Sivers on  Entrepreneurship, CD Baby and Wood Egg

3. F. M. Scherer on Industrial Economy, Digital Economy and Innovation

4. Diego Comin on Entrepreneurship, Technology and Global Economic Development

5. Stephen Walt on Global Development

6. Juliana Rotich on Social Entrepreneurial Innovation