A view of the Indian Institute Of Management in Ahmedabad, Gujarat, India. Image: View Pictures/Universal Images Group via Getty Images I
remember, after my thread ceremony, I was told to seek the blessings of the elders by reciting the following mantra: Abhivaadaye Vaishwamaitra
… the mantra, if you call it that, recites your lineage and your Gotra
In the startup era, your new Abhivaadaye
is your alma mater. While raising funds, if you recite the right Gotra
, Harvard, Stanford, Berkeley—the VC firm will pay a little more attention to your deck.
A recent analysis done by AngelList said that startups founded by alumni of lesser-known universities have had better ‘mark up rates’, i.e. their funding valuation moves up faster. But the analysis also admits, "This isn’t to say Stanford founders produce less successful startups than founders from other schools. Startups founded by Stanford alumni make up an outsized portion of startup success rates because of their higher valuations. The lower markup rates are indicative of founders from universities like Washington and Waterloo being unable to get high initial valuations on their startups, relative to startups founded by Stanford and Harvard alumni".
It is well known that a good alma mater gets you the attention your startup deserves and the right valuation. But what about the end consumer? Do they care if you are from IIM or IIT or BITS?
A year ago, one advertisement caught my attention. It was for a milk brand, Country Delight, which mentioned that it was an ‘An IIM Alumni Initiative’. This week, the brand was trending since someone had shared a picture of their milk pouch pack that mentions ‘Founded by IIM Alumni’.
A picture of a Country Delight milk pouch which proudly displays 'Founded by IIM Alumni'. Image courtesy Twitter
Does this make a difference to the perception of the brand? Digital advisor Ashok Lalla mocked the claim, saying, "Did the founders hope that people think IIM is the Indian Institute of Milk...".
Brands competing in cluttered markets look for points of difference (POD)—this is after they have ticked all the boxes of points of parity (POP).
In this case, the brand offers fresh milk, processed hygienically, full of goodness, packed and priced attractively, and so on. Their main claim seems to be that their milk comes to your home in just a few hours (as against all other brands that may be processing and storing the milk for days).
As a claim, this is very strong and a POD in capitals. The founders know that they are relatively new and don’t have the credibility or a dairy lineage, and hence, have used the IIM Alumni tag. Some ads even say that this is ‘A doodhwala
initiative by IIM Alumni’.
Obviously, this seems to have not just helped them raise venture capital money but also has given them a slight edge. Remember that in addition to the end consumers, there is the whole milk distribution ecosystem to consider, and it is likely that a shopkeeper will trust someone with the right education to not cheat you with poor quality milk.
And thanks to Hindustan Unilever Limited (HUL) and other FMCG (fast moving consumer goods) companies, gali gali ke dookandaars
know that IIM graduates are very competent folks—to sell soaps, shampoos and more.
Maybe the strategy of mentioning IIM is working for the brand. It was trending and here I am writing about them.Ambi Parameswaran is an ad veteran, a best-selling author and an IITM/IIMC alumnus. His views may be biased.