MP chatter with Max Azarov, co-founder and CEO of Novakid, about his entrepreneurial journey. Novakid is an online English as a second language learning platform reinventing the way children four to twelve learn English using language immersion, gamification, and virtual reality technologies to create an environment that helps children all over the world to learn English in a fun and exciting way.
Azarov is an experienced entrepreneur in the IT industry who has built a successful career in IT product management and software development, working for LG Electronics, Google, Cyber Vision, and Digital 5. He holds his undergraduate degree from the Moscow Institute of Physics and Technology and an MBA from the University of Massachusetts. Azarov’s IT background, along with a passion for the EdTech industry gained from teaching English to his children, led to the idea of a digital English learning platform. In 2017, he co-founded Novakid in Silicon Valley (USA) with Dmitry Malin.
The entrepreneurial journey is one of self-discovery. What have you learned about yourself while building your business?
Self-discovery is something we all need to go through as we are not one-dimensional and it’s not only crucial for business or your career.
For entrepreneurs, it’s more complicated because, in most cases, you start to associate yourself with your business.
It takes over your personality, and you tend to put yourself on the back burner. If you have a spare hour in the day, you ask yourself - should I speak with a therapist or do something for my business?
More often than not, the business wins.
This is a big problem that entrepreneurs need to be aware of.
If you neglect the process of self-discovery, it can lead to bad outcomes such as broken families and being unable to relate to other people. How can you say you know others when you are detached from your emotions and don’t know yourself?
Entrepreneurs are goal-driven.
What happens when those goals are achieved?
If you haven’t invested time in yourself and what drives you emotionally, it’s a difficult question to answer.
The entrepreneurial journey is often lonely. Have you experienced loneliness as an entrepreneur?
Yes, I have found this to be accurate.
It’s a natural human emotion.
From personal experience, you need a co-founder that can mitigate this feeling so you’re not in it alone, and you’ll always have someone to turn to.
Being a business owner is a long journey, so a trustworthy partner is essential.
Novakid is the second business that Dmitry and I have started together. I’m focused on the product, while Dmitry is focused on the operations, so we complement each other well.
That said, just because you have a co-founder doesn’t mean you don’t experience loneliness. One can feel lonely in the middle of a big crowd!
In those moments, there should be someone you can talk to about what you’re feeling, why you’re feeling that way, and what’s bothering you. This person could be your spouse or your best friend.
Hopefully, you have someone in your life who can listen to your concerns, hear you out, and offer advice.
It must be someone you can trust.
When you’re a leader in a business, most of the people you’re communicating with tend to speak to you as the boss, creating a sense of loneliness.
You need a peer who can understand what you are going through and will be honest.
For example, there may be internal issues that you need to discuss but can’t share the details with staff. It’s too early to panic but still concerning. That’s when you need someone to talk to.
Surrounding yourself with good company is essential.
The Psychological Warfare
Entrepreneurs generally sleep less, work more, and let their health slip. This combination, combined with loneliness, often results in insecurity, self-esteem issues, and low self-worth. Have you experienced any of these issues as an entrepreneur?
Entrepreneurs are more likely to experience burnout if they consider the risks and responsibilities of running their businesses.
This is especially true after the past two years, thanks to the pandemic.
According to , 92 percent of small business owners have experienced mental health problems over the past two years.
As mentioned, self-discovery is essential.
You have to know what you stand for and who you are.
I don’t recall feeling insecure about myself, which is one thing that has kept me even-keeled.
I have confidence in myself to know that whatever comes my way, whatever failures I might have had, it’s not because something is wrong with me.
Perhaps the timing wasn’t right, or other factors were at play that led to the failure.
In many cases, entrepreneurs are delusional and have delusions of self-worth.
If you kill this within yourself, then everything falls.
Believe in yourself and your abilities.
Trust your past experiences.
This doesn’t mean you won’t get depressed or have a bad day. I have moments when I wallow in self-pity, but again, having someone to talk to will remind you why you’re on this journey.
Your emotions are something you can control.
You can’t control the outside world.
It takes practice to keep your emotions in check.
It’s important to remember that you are in control, not someone else, and things happen because of your actions.
Newer entrepreneurs often equate their personal success with the success and value of their business. If their business fails, they are a failure. If their business succeeds, they are a success. Have you experienced this warped perception of reality?
This is something I experienced and can relate to! As I mentioned, entrepreneurs essentially become their businesses–it takes over your life to a certain extent.
Not every idea was good, and not every pipeline came to fruition. I had a few spectacular failures before becoming an entrepreneur. In one case, I accepted a job and quickly realized I wasn’t up to the challenge.
This will inevitably happen to everyone. But what I usually remind myself is that this is how we grow. Experiencing these moments is your opportunity to look deep inside yourself, find your worth, and start building again from this newly found foundation.
That is how it worked for me. There is a period when you are devastated, you just want to sleep and phase in and out of your life, but through failures, you are forced to go on a self-discovery journey.
In this sense, if there is an entrepreneur who has only had success, it’s a dangerous place to be, as they have never been forced to look within themselves. Don’t be afraid to make mistakes early on when the pressure isn’t as intense, and get the benefits of learning from those mistakes.
What are your three biggest fears as an entrepreneur, and how do you manage those fears?
To be honest, I don’t think about fears. Fear is not in my vocabulary. The word I would use instead is a risk.
I think about the risks I face and how I can manage those risks. Fear is an emotion; in business, there often isn’t a time or place for emotion when decisions need to be made.
Instead, think of risks as obstacles that need to be overcome. This is a healthier way of thinking about issues. Fear stalls you or makes you run away, and neither of those actions is desirable!
The issues I consider to be the most significant risk to my business are not original or unique, but that doesn’t make them any less accurate:
1. Running Out of Cash
Cash is king, and without it, your business is done.
2. Having the Wrong Team
Having the wrong team is bad for your business, especially if their ability to execute your vision is not up to par.
3. Missing Opportunities
Missing market trends or losing your product-market fit (or not finding your product market fit). You have to find ways to mitigate this. Otherwise, your business will likely fail.
What are three mistakes you made early on as an entrepreneur, what did you learn from them, and how can others avoid these mistakes?
1. Not Building Relationships With Funding Partners in Advance
Eventually, you will be at the stage where you will consider investment partners to take your business to the next level. I made the mistake of thinking it would be relatively easy to find funding partners.
One of the most challenging things to deal with was rejection while raising capital or looking for partners, especially when the company wasn’t making much profit.
I had to switch to ‘survival mode’ and focused only on the actions that got the company through another day.
Building relationships with venture capitalists and investors take months, sometimes years!
Start this process well before you need the money. Our Round A took longer than we anticipated because most investors wanted to get to know us before asking for money. With existing relationships, Round B was a much faster process. Even when we aren’t fundraising, we keep potential investors warm by sending them quarterly updates.
When working with investors, pay attention when they speak. Think of your investors as mentors who believe in your idea just as much as you do. However, investors also have a literal stake in the success of your idea, and they're less emotionally invested than you. This, plus their business acumen, gives them a better perspective on your venture.
Investors may not always have positive things to say about your concepts and the next steps of your plan. Rejection stings and criticism is hard to hear but receiving this type of informed feedback is invaluable. It’s a chance to go back to the drawing board and make a more solid and detailed plan of action before you sink further time and money into your venture.
2. Not Considering Critical Issues the Business Was Facing
I mistakenly took a "winging it" approach to growth costs. I became so focused on expanding that I underestimated the costs of growth. This is a massive error when you're operating on an investment model.
It’s better to think logically and crunch the numbers for everything that expansion entails, including onboarding new staff, salaries, new software, and so forth, and then add 20 percent to that number for incidental costs. Can you weather that number and remain successful? If not, then it's not yet worth the risk.
While it's true that minor personnel problems or morale issues might not stall your growth, it's a mistake to overlook these things instead of considering these as red flags. One person’s performance usually won’t make or break your business. Still, if left unchecked, it will eventually cascade into entire departments or teams that lack efficiency, leading to more complex challenges.
Pay attention to all problems before you even think of expanding. Your house should be in order before you start chasing expansion.
3. Not Keeping Cultural Nuances in Mind With an International Product
As part of our curriculum, we included an activity based on the game ‘Hangman,’ where children needed to fill in the missing letters of a word to complete it before the time ran out and the character was ‘hanged.’
Turkish parents were shocked and complained that we were showing their children ‘hanging scenes.’ We had to change the game to ‘Hungry Caterpillar, ’ wherein the caterpillar eats an apple every time the child submits an incorrect answer. This taught me the importance of cultural sensitivity, which is now carried through to other aspects of our business, including marketing and our teacher onboarding process.
What are three things you see that are often overlooked by entrepreneurs you encounter, and how can other entrepreneurs be aware of these things from the beginning?
1. Waiting for the Product To Be Perfect Before Launching
A common problem with startups is getting too caught up in developing the “perfect product” before they launch. They spend too much time on minor details, obsessed with getting everything just right before anyone tries it.
An MVP (Minimum Viable Product) is the bridge between where you currently are and where you want to end up with a raw, workable product in the market. This gives you the benefit of tweaking it to meet the specific complaints or needs of the people you're selling to. Experts say it’s common to take up to four months to create a good MVP. For example, we developed the prototype of Novakid in just three months, which is a pretty tight turnaround on an MVP.
Initially, we only had a video chat feature and an interactive map for kids and teachers. However, through mistakes and setbacks, we’ve evolved thousands of native-speaking teachers, VR and AR technology, gamification, and machine learning that help more than 380,000 students globally.
In our early days, the rudimentary prototype was sufficient to get us started and help us learn what worked and what didn’t. It also proved product-market fit and set us on a growth trajectory that allowed us to scale through the COVID-19 lockdowns. If we had waited until we had a "perfect" solution, Novakid would still be just a pipe dream.
2. Being Afraid To Ask Questions
Unabashed curiosity is a child's greatest strength, but as we grow, we learn to reduce our curiosity out of shame or fear of looking silly. However, studies show that curiosity is crucial for success. It helps you clarify your company’s goals and optimize your brand strategy.
Remember that you're building your business to serve a target audience. They're not experts; they depend on you to help them solve a problem or meet a need without confusing jargon.
In our case, I knew plenty about the tech side of our product, but teaching language was new to me. Our approach was quite a departure from the learning methods I knew of, so I had to ask many “layperson” questions that might have sounded stupid or obvious to an expert.
If I had been too afraid to ask questions about the total addressable market or the expected retention period, or mechanisms of the edtech market in general, I wouldn’t have been able to continue to develop our product confidently, nor would I have known to help skeptical parents understand why using Novakid was better for their children than the more complex methods they were familiar with.
3. Fearing Failure
Failure is a near-certainty in the realm of entrepreneurship. Be conscious that it may not work the first time, and you may need to pivot or even start a new company before you succeed. My first business never took off as expected. After five years of trying, I decided it was time to start something new. Failure opens new doors to create a different path to success.
I learned that failure is a good thing. Founders who have previously failed have a higher chance of success than first-time entrepreneurs, so don't be afraid to go all-in on a new venture. It's important to remember that the foundation of who you are as a person was built in part by those previous successes and mistakes. In my observations, it's better to let all your experience remain at the forefront of your mind. Yes, you will need to learn plenty of new things, but you never know when you'll be able to cross-reference similar situations from your previous career.
The reality is that about 90% of startups fail. 10% of startups fail within the first year. Across all industries, startup failure rates seem close to the same. Failure is most common for startups during years two through five, with 70% falling into this category.
However, remember that some of the most famous entrepreneurs of our time succeeded by persevering until they conquered the market and brought their dreams to life.
What are three seemingly insurmountable obstacles you’ve faced as an entrepreneur, and how have you overcome them?
1. Starting From Scratch
Our customer, which accounted for 90% of the revenues, canceled its contract. We had to rebuild our customer base basically from ground zero. I switched to a survival mode, with the sense of urgency helping me to overcome my fear of rejection. I jumped on LinkedIn, started cold-emailing and cold-calling, and, as luck would have it, was able to secure another customer.
2. Raising Our Seed Round Was Tough
We had several investors saying, “come back in six months.” That’s precisely what we ended up doing. We kept following up every three months on our progress, and finally, our ability to execute convinced one of the funds to pull the trigger.
3. Finding Time for a Family Is Difficult
This is especially true in the early days when the demand for your time is at its highest. I found it essential to get my spouse on board that I would be “missing in action” for some time, and she would need to provide cover. It’s important to remember to gradually phase out of this mode or face the real risk of losing your family.
What are three ways you have managed to boost your productivity without causing burnout?
Choose the right team members for the job and delegate. Resist micromanagement tendencies.
2. Sync Up on Essential Activities
Allocate regular meetings to sync up on essential activities and projects (weekly, bi-weekly, monthly). This way, there’s less chance of something important slipping through the cracks.
3. Calendar Management Software
Automated calendar management software (we use Calendly) allows you to schedule meetings and tasks. By the end of the week, it is pretty easy to analyze which things remained unsolved during the working days and what progress I have made. Everyone should be using it!
How can newer entrepreneurs develop a healthy work-life balance even when it seems like an impossible task?
The freedom and flexibility that comes with entrepreneurship can be hard to manage. This is where discipline comes in. You can go to the gym in the morning, but you need to know that you will accomplish your work goals in the afternoon. You can spend the afternoon doing admin or being with your kids, but then know you’re going to split your day into morning and evening.
This is important because being too rigid can make your days feel complicated and complex. Instead, work on having a flexible mindset so you can adapt each day to what it brings, and trust in yourself to get the job done. Entrepreneurship requires a lot of self-management, and this is a learning curve, so don’t be hard on yourself or your employees as they get used to this.
What three key pieces of advice would have made your entrepreneurial journey easier, and why?
1. Be Consistently Available to Your Team
Think of yourself as the captain of a sports team. How you behave sets the tone for how the rest of the players behave. You shouldn't be an occasional, important guest in meetings or a surprise visitor during a workday.
Instead, you're the involved parent who is reliable, always around, and enthusiastic about jumping in to lend a hand wherever you're needed. Employees should feel comfortable coming to you over big and small issues.
If your company is too large for this to be feasible, set up weekly or monthly "town hall" meetings that give your team candid access to you. Showing you're more than just a busy, "important" figurehead boosts morale and makes employees feel more engaged.
2. Be Open With Everyone in the Business – You’re All in This Together
This is the logical next step in building healthy structures and relationships within the company. You should ensure that your team is kept in the loop about financials, failures, and successes.
Keeping secrets undermines the idea that you're all in this together. Total transparency across the board creates a sense of a team. It helps everyone feel like you're all working to build something great together. Transparency also breeds trust and makes employees happier and more productive.
3. Get a Mentor
I’ve had multiple mentors along the way. One of my first mentors was a more seasoned manager from Serbia who taught me, a self-absorbed software engineer, to see the world from a different perspective. I’ve also met brilliant people working for Google who taught me a lesson.
I was also lucky to be mentored by our investors, who guided me through my experience of being in the brave new world of international finance (new for me anyway!).
I would encourage all entrepreneurs to find successful mentors and advisors in their chosen industries. Finding the right mentor will depend on your industry, but entrepreneurs can connect with potential mentors via online communities like Reddit and LinkedIn or through services like SCORE. Making meaningful connections with industry experts (even if you don’t hire them onto your team) gives you an invaluable well of insider knowledge to tap into. Industry veterans often have lessons and experience you won’t find in books or reports, so they can help you avoid pitfalls and navigate unfamiliar territory with fewer missteps.
What do you think the most significant difference is between how an entrepreneur sees their career path versus how an employee at a company sees their career path, and why?
I think life can be fulfilling in both cases. Entrepreneurs generally tend to be people who don’t want to work for someone else or who people find hard to manage, so they have to make their path.
What role has intuition played in your success as an entrepreneur, and why do you think this is the case?
It plays a huge role in my career and business! You are constantly making decisions based on incomplete data, and you need to make sense of many data points coming at you from all sides. The only way to make sense of things is through intuition. You can’t write a thesis on every issue, and you don’t always have time to spend hours researching an issue - life happens too fast. You need well-trained intuition to connect the dots.
This doesn’t mean research isn’t needed or important, but you must bridge the gap between the missing data and the decision you need to make with intuition.
Is there anything else you would like to share?
As an entrepreneur, I like to start my day by reminding myself that we all have a choice and an opportunity to use our skills, talents, and passions to improve the world. Choosing to make a positive impact helps us reach our ultimate purpose and fulfillment. By doing your part to make a lasting, positive impact on the environment or society, you are choosing a life of happiness and meaning that will have a long-lasting positive impact on future generations.
Throughout my entrepreneurial journey, I have experienced so much and, in turn, have learned so much. These are some of the traits I think I have developed more deeply since starting Novakid:
Raising capital for our startup, particularly early on, was fraught with rejection and some investors questioning my business concept's validity or long-term viability. It took a great deal of resilience to stay focused on building my venture with the belief that what I was creating was truly special. This resilience allows me to continue the fight for entrepreneurship every day.
When you’re focused on building a startup, you need to see things from all perspectives, not just your own. It’s easy to fall into that trap, but having empathy for others and what is driving them is essential to creating consensus.
For example, when pitching to potential investors, there’s a considerable gap — you are the entrepreneur, deeply immersed in your business. At the same time, your listeners are finance folks with a superficial understanding of your business's workings.
You have to bridge this gap to give them enough confidence to invest. This can only be done by empathizing with your audience, thinking like your listener, and crafting your message so that it will be heard and properly appreciated.
Practicing gratitude is part of my daily routine. Especially when things don’t turn out the way you expect them to, it’s essential to have a healthy perspective on life’s shortcomings. When my first startup failed, it was terrifying. But I would remind myself every day of all the beautiful blessings in my life, which helped me persevere through falling and allowed me to get back up again to do bigger and better things.