A Business Success Book Every Indian Entrepreneur Shouldn’t Miss

I am happy to announce that my third book is getting published during the pandemic. After publishing Balancing is the Work in Oct 2020, a significant book Indian Women & Financial Fitness was published on the International Women’s Day 2021.

& now Indian Startups, SMEs, & Financial Literacy.

Cover Page

Financial Literacy is very important literacy but ironically is not given the importance it deserves in our education system.

“One of the reasons the rich get richer, the poor get poorer and the middle-class struggles in debt is because the subject of money is taught at home, not at school.” Robert Kiyosaki, Educational Entrepreneur.

According to Organization for Economic Cooperation and Development (OECD) “financial literacy as a combination of awareness, knowledge, skill, attitude, and behaviour necessary to make sound financial decisions and ultimately achieve individual well-being”.

As per the ‘Global Financial literacy barometer’, India ranked 23rd among the 28 countries surveyed, with 35 percent of its population termed financially literate.

As per a global survey by Standard & Poor’s Financial Services LLC (S&P) less than 25% of adults are financially literate in South Asian countries. For an average Indian, financial literacy is yet to become a priority. India is home to 17.5% of the world’s population but nearly 76% of its adult population does not understand even the basic financial concepts.

“The number one problem in today’s generation and the economy is the lack of financial literacy.” Alan Greenspan

Here is the first chapter borrowed from the book about: Why this book?

A special address by H.M. Queen Maxima of the Netherlands at 3rd OECD/GFLEC Global Policy Research Symposium to Advance Financial Literacy, 2015 stated, “The importance of micro, small, and medium-sized enterprises to growth and employment can hardly be overstated. These make up the majority of enterprises in the world. They provide jobs and contribute significantly to national incomes. They therefore play a central role in sustainable, inclusive economic growth and development.

But many business people face real challenges that prevent them from starting a business and making it grow. This comes from an inability to make informed choices or knowing where to get advice. Financial education allows us to address this and thus fulfill their potential.

By improving the financial literacy of business owners through financial education, we unlock jobs and growth, two elements so desperately lacking in many of our economies.” (1)

Entrepreneurs use the nation’s resources. Therefore, their financial literacy can add to the nation’s prosperity and their financial illiteracy does the reverse. 

Non-Performing Assets (NPAs) are just a fraction of the problem of the Indian financial system, but it is 100% of the problem of the entrepreneur whose accounts have become NPA.

According to the Webster dictionary, the meaning of the word Entrepreneur is; a person who starts a business and is willing to risk loss in order to make money.

But no entrepreneur starts a business by looking at this definition. And is willing to risk loss is a critical condition of the definition. Everyone is focused on the remaining part of the definition i.e., a person who starts a business in order to make money.

Two critical phrases of the definition are willing to take risks and to make money and therefore the entrepreneurs must understand both these aspects in order to be successful. 

Everybody is out there in order to make money but alas, most entrepreneurs are neither aware of the risk they are taking nor the money they are making. Many of them are not even financially literate; mostly they can’t understand the financial statements.

Most Startups / SME entrepreneurs neither read audit reports nor analyze the financial statements as the large corporations do.

Most of these entrepreneurs not only lack advisors who can guide them on an ongoing basis, but they also suffer from an ‘I know it all’ mindset.    

Starting a business is easy and does not need any educational degrees, but not able to understand the results of own endeavour is foolishness and can prove disastrous.

Financial illiteracy in business is dangerous, yet it is widespread.

The advice of CFOs/ CAs, and Accountants is valuable, but they are not entrepreneurs and therefore financially literate entrepreneurs are better placed in decision making. Therefore, financial literacy is necessary for every entrepreneur. 

Not knowing these basic fundamentals of business finance & management makes the entrepreneur vulnerable and this ignorance can cost dearly.  

An entrepreneur’s financial literacy is one of the key attributes that directly influences the success of a Startups.

“Being promoted to a top position in your organization, or even being elected to public office, does not suddenly endow you with financial literacy, if you did not acquire and develop it, earlier in your life.” Strive Masiyiwa, founder of Econet Wireless

But surprisingly, financial literacy is an area in which many entrepreneurs are lacking. That is why statistics show that 95% of Startups fail within their first five years due to poor financial management reasons.

Their failure has social, as well as national economic impact.

This book is an attempt to educate entrepreneurs about how to read the success or failure of their endeavour. I hope banks and Angel Investors, and VCs would gift this book to every borrower & start up entrepreneur to educate, caution, and prevent NP part of NPA and failure of the venture.

Impact of business failure is given in the image below.

NPAs are not only weakening banks, but it also weakens the economy and our society. Whereas Startups failure creates a taboo in the minds of young entrepreneurs.

I also hope this will help to avoid NPAs and failure of Startups in the future, though to some extent. 

The foreword for the book is written by CA Suresh Prabhu, Former Minister, GOI and Former Chairman, Saraswat Bank.

The book has received advance praise from CA Shailesh Haribhakti, Chairman, L & T Finance Holdings Ltd, Tamal Bandyopadhyay, Consulting Editor, Business Standard, Bharat Shah, MD, The Ruby Mills Ltd., Ruchi Singh, CEO, Niine Hygiene & Personal Care, Sqdn Ldr. Sumedha Chopra (Retd.), IIM – A Alumna, & Tanutejas Saraswat CEO, ShopKirana.

Here is what the stalwarts have to say:

I think the gamut of subjects covered in this book makes it mandatory reading for every entrepreneur especially start-ups and SMEs. India needs more financially literate entrepreneurs and I am sure this book will serve the purpose for which it is written.

CA Suresh Prabhu, India’s Sherpa to the G7 and G20, Former Minister, GOI .

Sunil’s wonderful book is a fine balance between practice and theory, learning and doing, risk-taking and entrepreneurship, past practices, and future strategies, and provides a dependable guide to the accomplishments and failures of start-ups. It is a must-read for a wide swathe of emerging and thriving 109 Unicorn India.

CA Shailesh Haribhakti, Chairman, L & T Finance Holdings Ltd.

Irrespective of the stage of their businesses, the tribe of entrepreneurs will find this book useful.

Tamal Bandyopadhyay, Consulting Editor, Business Standard.

Here is a link to the book.

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