These entrepreneurs left Rocket Internet to strike out on their own. Now they reveal how to beat Rocket companies

The Rocket Internet way is often vilified as a ‘copycat’ model, but it’s formidable in its efficiency. It’s based on a belief that in a flat world, there’s no need to reinvent the wheel – a good idea that has succeeded in one place can always be replicated elsewhere. Typically, a successful internet venture in the West is cloned in the East. Examples are many, from Amazon-like Lazada and Airbnb clone Wimdu to GrubHub inspired Foodpanda.

Instead of wasting time on developing new ideas, they pick sureshots and focus on the execution. The advantage is that you get a proven business model. So the time to start up and gain traction is shortened. It takes less than 100 days to launch a business for 80 percent of Rocket Internet companies – something that’s very hard to do for any normal startup that begins with a new idea and then validates it.

But there are disadvantages, and frustrations too, in such an execution-driven model – especially for those with an entrepreneurial and innovative streak. Three such entrepreneurs, who were earlier with Rocket Internet, explained the good, the bad, and the ugly of copycat startups at a free-ranging discussion at our Startup Asia Jakarta 2014 conference today.

Pros and cons of the Rocket way

Steven Kim, co-founder and CEO of restaurant discovery site Qraved, worked at Rocket Internet’s OfficeFab before it shut down. He says the key difference between a Rocket company and a typical startup is speed. “Early on, they don’t talk of chicken-and-egg problem, et cetera. Basically, choose one thing, and go hammering at it.”

Juan Chene, VP of business development at Bobobobo, who was earlier an MD at Foodpanda, agrees. “High benchmarks are set, and KPIs have to be achieved. From marketing channels to customer acquisition, everything is measured on a daily basis. The top guy might call you anytime.”

There are negatives too in such a sterilized, fast-track approach.

As Fung Fuk Lestario, co-founder and CEO of Rupawa, puts it: “It can be chaotic. We hired 50 people at one go. Because of that, there will be a lot of turmoil. If you do it at normal pace, you will build the culture slowly. But here we have to do steroidal hiring. Because of the lack of culture building, there will be a lot of friction, and so a lot of attrition too.”

But Juan Chene pointed out the positive side as well: “The focus for Foodpanda was to get a lot of big restaurants onboard right in the beginning. So we had to get a great sales force and advertisers straight away. The sales excellence focus can be interesting to learn and replicate.”

Why are Rocket grads such assholes?

To this question from the Startup Asia moderator, who was Kevin Aluwi, chief financial officer at Indonesian motorcycle taxi aggregator Go-Jek, the three panelists became introspective.

Fung Fuk Lestario was the first to tackle it: “We are given a lot of budget, and with it a lot of responsibility. That is a lot of power, and sense of decision-making, which can go to the head of some people – some, not all [laughs]. That’s my diplomatic answer.”

Steven Kim personalized it: “You feel you are way more in the top rungs compared to your peers at that point of time in their careers. With that comes long hours, lack of sleep, no time to exercise, and you grow overweight and grumpy.”