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Building An Ecosystem For Car Owners | Amit Lakhotia @ Park+
165 Plays4 years ago
Scaling start-ups is not new to Amit Lakhotia. So, the choice of starting his venture came naturally to him.
In a candid conversation with Akshay Datt, Amit Lakhotia, Founder, Park+, takes us through his amazing journey. This IIM-A alumnus has worked with various start-ups before charting his path towards entrepreneurship.
An independent decision-maker at heart, Amit chose the companies where he can take decisions without any interventions, and the results are evident in the growth stories of MakeMyTrip, Paytm, and Tokopedia.
Stemming from his experience of not being able to find a parking slot at the Paytm office, Amit started Park+ in 2019 with a vision to solve the parking-related woes for daily commuters and B2B establishments.
Tune in to this episode to hear Amit talk about Park+ is working towards solving this hyperlocal problem by providing digital solutions, leading to a hassle-free customer experience.
Key takeaways:
- What a B-School teaches us!
- Experience of working in a start-up
- Journey as an investor
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Transcript
00:00:00
Speaker
Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour. Take me on a tour.
Launching PTM Wallet
00:00:32
Speaker
Everyone knows this jingle, when a payment is made using the PTM wallet. But did you know that way back in 2012, when Amit Lakhotia joined PTM as a very young fintech startup, it did not have a wallet. And in fact, it was Amit's initiative to launch a wallet for PTM and take it through the journey of becoming India's default alternative to cash.
00:00:56
Speaker
Despite his successes as an employee, Amit was always driven by the need to create an impact as the founder of a business. And finally, he took the plunge in 2019 with his venture, Parplus.
00:01:09
Speaker
But Plus has been an agile startup adapting to the need of the time and supporting India in combating the second wave of Covid, while also scaling up its core offering. Here's Amit telling Akshay Dutt about his experience at IIM Ahmedabad, which he joined a year after completing his engineering degree. I mean, experience was actually transformational. Like every guy you meet is like a topper somewhere.
00:01:35
Speaker
Every guy you meet has like tons of credit in his life earlier and you were like, and like people will just keep mesmerizing you. Like the same guy will be topping in academics would be good in sports. Some guys would be good in music as well. And you're like, so that constant reminder, like we'll keep hitting you one way or the other that I should have probably made more use of my
00:02:05
Speaker
like graduation days that's what you saw people doing there and that is one thing the second thing is respect for time so I mean most of the deadlines would be like 8 59 59 so which means you have to like it can't be even 9 o'clock it is 8 59 59
00:02:24
Speaker
So systems, whether it is online, whether offline, they will close. Like I have seen my class professors just shutting down doors of class on me because I just like maybe a second late. They could see me running to the class, but the class goes still got like, imagine you waking up at like 850, realizing the class is at nine.
00:02:47
Speaker
and then you are running literally a kilometer to just reach to the class and still you are probably late by a couple of seconds the professor can see you running towards him you are like 20-25 meters from the class and still the door gets shut down on your face so those things happened and then what you also understood was like because the quality of peers around you was very high the quality of work expectation was also very high
00:03:13
Speaker
People will call it out if you try to bullshit, if you try to present crap. I think the quality of peer was very, very high. That was like unthinkable type. And then you go through the heavy pressure situations, whether it is in surprises, surprise quizzes every day. You don't know which subject quiz would happen today. And then placements, obviously, again, it sounds very exciting from outside.
IIM Ahmedabad Experience
00:03:43
Speaker
Top companies would come but what would happen is those 3, 4, 5, 6 days of placement like it is now raking.
00:03:56
Speaker
Because you will just move from one room to another room for another conversation. Make my trip must have been very high risk. The top employers would have been banks, FMCGs, consulting companies.
00:04:15
Speaker
so everybody wanted to be a consultant or a banker at that point of time like these were the highest paying jobs at that time i used to run a small souvenir shop within the campus so which is like every campus has this souvenir shop and our shop the ima shop was run by students normally people will run it for a point from a point of view a cv point
00:04:37
Speaker
okay i can write like and i ran that business very very seriously so i converted that to from a loss of say thirty forty fifty thousand ten annum to a profit of about a lakh one and a half lakh rupees per annum and i used to spend and in about eight nine months and i used to spend a lot of time doing that.
00:04:56
Speaker
And I understood that that was my calling. I never wanted to be a banker. I never wanted to be a consultant. So I realized my kick was there. I got a private equity from the offer.
Entrepreneurial Realization
00:05:17
Speaker
And but I still thought that I'm still too early. I don't even understand business. I would like I think of investment as in a private equity stuff. And till the time I'm not in an operating role. I don't think so. I can understand the business and the pressure that goes along with it. So like I came out and at that point of time I did my summer internship at ITC. And I realized that
00:05:45
Speaker
like the whole FMCG distribution was broken like it was completely dependent of the last guy whether he is sincere or not sincere etc. A typical sales guy would look at like one particular area with like 1000 shops but he can go only to like 10-15 shops in a day which means probably he'll cover about only 30-40 shops restaurant like at the mercy of the other shopkeepers, distributors etc.
00:06:13
Speaker
And I thought that if there is a system which can digitize everything like a company real-time knows how much of stock is available at any point of time and if it is depleting the company can immediately send fresh stock without depending on like the sales guy because that quality is like can't be consistent.
00:06:36
Speaker
I said that company would have a lot of leverage and that is the point of time. Like we used to tell our friends in US. The understanding was that because it is online, you can stock it at a remote warehouse. And then when people order it, you can ship from there. So you don't have to pay your costs around location, rent, lot of employees, etc.
00:07:03
Speaker
And I was one of those guys who used to love coding at that part of time. So I said, yeah, I would look at an internet company to start. And you would require so much capital even for an internet company. Companies can run billions of dollars without getting profitable. Most times, we thought, shuru jayagat harchi se ai jayage.
00:07:27
Speaker
And that is where I reached out to people. At that time, there were only three decent sized internet companies. Shadi, Nokia, and Make My Trip. And Nokia had their IPO over big.
00:07:39
Speaker
Shadi, at that age, I didn't want to join anything which is remotely connected to marriages. And then, MakeMatter was the only company left in the whole set.
MakeMyTrip Journey
00:07:56
Speaker
And I reached out to Deep, Deep was a senior at IME, 92 batch. He was very surprised because, like,
00:08:06
Speaker
The Make My Trip wasn't the company people used to aspire from IMA, or any of the IMs actually. So I was like the first IMA grad to join Make My Trip after IMA. There was no other IMA grad at that point of time. And the idea was like in my first meeting, I told Deep Ksar Mir Kaata Naeya, but my aim is to spend three, four years and build a strong business.
00:08:32
Speaker
So give me a business, which doesn't require a lot of intervention from a lot of other people, but still can become sizable. And the deep side, see, we are a B2C company. So if you become a part of a B2C business like and so why don't you look at our B2B business? So he said, why would be to be is not very sexy, but like India is B2B right now.
00:08:58
Speaker
Like the card penetration was lower, internet penetration was lower, smartphones were negligible, like it was pushed. And most of the ticket bookings, like I think 90-95% of the bookings were happening through travel agents. So he said, why don't you look at that business? And he said clearly that gradually internet penetration etc will increase, B2C will become bigger. But that time will come at a certain time. I said that's okay, I'll look at that business.
00:09:28
Speaker
So my role was to build the whole B2B distribution business, which means that travel agents, corporates, et cetera, could log in into the McMater platform at that point of time and to book. And that was like, by the time I left close to 100 million dollar involved GMV business and it was profitable. And actually it was about one third, one fourth of McMater business at that time.
00:09:52
Speaker
Well, you started from zero, this business. Yeah, started from zero. And for like, and what also happened was like I joined with my trip in 2007 and 2008 recession hit. And so company did not had enough money to even invest. And so for like a whole year and a half, I kept running with like just two engineers. To build the product. To build the product. So that was a super painful time at that point of time.
00:10:23
Speaker
because I was not a very, very extrovert guy. So, and I haven't done sales in my life earlier. And when you go out, like it was uncomfortable because the McMatter was known as a B2C brand. There was no B2B variant at that point of time. I spent nearly a year to build the B2B variant.
00:10:51
Speaker
And by 2009, when the things started becoming better, companies started giving more investment in this business. And that is where I set up the whole sales team, distribution team, the business scaled up well at that point of time. You used to go. I used to go. And did you like target the agencies first, your corporate first? Agencies. I went to a couple of corporates and then I realized
00:11:21
Speaker
that my product is not at that level. And most of the corporates didn't want to do DIY at that point of time. And the features they would ask for, ABAutomato ganache, ABAunache, ABAunache, then I realized that we are still some time away. Let us first build the product from a travel agent point of view and then probably go to the corporate part.
00:11:39
Speaker
Got it. Okay. So, and then, you know, what made you switch and, you know, move to another company? Like, I think you had your own startup after that. So like, I spent about four years at Make My Trips, saw the IPO happening. And like I told you, I was always keen on doing my own stuff.
00:12:03
Speaker
So one of my friends at Make My Trip, he started this taxi company called Get Me Cab. And the basic thesis was that the flight has been already aggregated by Make My Trip. And rail is already aggregated online. Bus is aggregated by Redbus. What are left? Things left which are hotels and cabs.
00:12:22
Speaker
And the make matter wanted to sell hotel was to list hotels and then sell. And my approach was slightly different. I was thinking that this is not the way Indian consumers transact hotels. What they do is they get to the location, see three, four hotels themselves. They negotiate on the price and they go to the best total available. So I said, why don't we replicate this same scenario in the offline world?
00:12:51
Speaker
So in the online world, so what would happen is, and that time the cab services were broken, there was no way to book a cab also. And what was also interesting was like, if you look at most of the top locations in India, like for example, if you look Delhi as an example, you look Shimla, Manali, Masurin, Anital, Dharadun, Jaipur, like all these locations are not very well connected by trains or airports.
00:13:19
Speaker
or even if they are connected they are super expensive like you can't take a 4 member, 5 member family from Delhi to Shimla in a flight although possible and roads were fairly well connected so I said most of the people will be driving through roads so like and taxi there was no taxi service so idea was like if I can put people in my taxi the driver takes them to the 4 hotels which I have already shortlisted
00:13:49
Speaker
and tell them to negotiate whatever the price they want to negotiate. Also driver tells them an indicative value saying typically this hotel becomes available at this price, et cetera. So, so that way, like what happens is customer gets that his cake that I haven't seen the hotels. I am negotiated, et cetera, et cetera. I don't care about which hotel customer books because for all four are my hotels and with hotel here, I have a clear understanding that I'll get a 15, 20% cut.
00:14:17
Speaker
and what also happens is see now the guys in your cab right
Get Me Cab Co-founding
00:14:22
Speaker
and my understanding was gradually where to eat where to shop what to activities to do everything is normally driven through driver see today we are very well connected on phones and we can check reviews etc that is the point of time smartphones weren't prevalent
00:14:39
Speaker
so I was like anyways you are asking the driver even today like when you go to a location you can always you always start with asking driver and driver will tell you then you might do a review check etc but driver plays a key important role when in your outstation trip so my idea was if that whole all set of activities get completed on my platform itself like I can make a 15-20% cut on every activity
00:15:10
Speaker
And then suddenly, if your per day spend is like 5,000 rupees, which is including your hotel, which is including your food, which is including some part of shopping, et cetera. And if I can make like a 15, 18% out there, I'll make like 500, 2,000 rupees per day of that trip. And if that trip is like three, four, five days, then suddenly you can make three, four, 5,000 rupees. And that business started working that way.
00:15:40
Speaker
that business started working that way. If I understand correctly, people could book a taxi, let's say from Delhi to Sibla on your platform. And when they book the taxi, then you also have these upselling happening there in which you introduce them to hotels, introduce them to places to eat, etc. And you are also earning from those introductions. That's right.
00:16:07
Speaker
Like you know what happened like this was a one-year experiment. Why did it not work out? So actually from a business point of view it did very well Like we broke even in the first month of third month of operation. We were doing close to about hundred transactions a day and like all our capex objects of the office all salaries, etcetera, we were bootstrapped and everything was still
00:16:34
Speaker
like getting paid through the revenue generated by the business. So it was a fairly decent business. By that time, Ola also came. Ola was actually a year ahead of us. And then Ola and Taxifor shifted their focus from outstation to within city. And Ola also raised some capital. Taxifor Shor was also raising capital. And that is the point of time when there wasn't a lot of capital available or even if it was available, it was coming at a very high cost.
00:17:02
Speaker
like they will say we will give you 2 crore but we will value company at say 7 crore, 10 crore that kind of stuff and I was like we had made some money out of make my trapeze shops when we had sold them and then I said like what is the point of spending raising 2 crore at 7 crore type and that is where me and my partner had a disconnect
00:17:30
Speaker
So I was one of those guys who wanted to build the business aggressively, you want to build a big business. The other guy, like we had a philosophy difference and how to build a business, how to run a business, etc. So it didn't work out between both of us. So I said, okay, that's okay. Like you started the business, you should continue the business. Then I moved out. Okay. Okay. Okay. Okay.
00:17:53
Speaker
Okay. And that business obviously didn't scale much now. So then you joined PTM. Then I joined, like I was trying to figure out what to do. And since this business was doing, had done well, like from an operations point of view, like it built that confidence that so I was again looking at doing my own stuff.
00:18:22
Speaker
But at that time, it wasn't very clear. Like you, Snapdeel was still selling coupons, Flipkart was selling books, et cetera. I was like, beyond a point, people aren't going to look at coupons, et cetera. That's not going to be a really problem. So I was still trying to figure out what to do. And that is the point of time I met with Deep.
00:18:52
Speaker
sorry Vijay at one of somewhere and we just said why don't you come and build payments for us and my Make My Trip experience taught me that payments in India were very bad at that point of time. Success rates were low, response rates were very very bad. Refunds could take anywhere between 3 to 4 weeks to come in. There was no visibility on when the refunds would etc happen.
00:19:18
Speaker
So I knew that payment experience was broken and that is the point of time I also realized that I don't know what will click in India for online sales.
PTM Wallet Success and Challenges
00:19:26
Speaker
But whatever will click it will require payments.
00:19:34
Speaker
I said let's improve the payment experience. Okay. And this was B2B or B2C? This was B2C. Okay. Consumer experience. Okay. Okay. That is what you built. That is what I built. So the idea was like, there were two thoughts. One is everybody at that point of time was focusing on improving the payment gateway success.
00:20:01
Speaker
So like BU was there, cetera started, CC Avenue started, et cetera. And I was like, in payment bank, payment gateway, I am finally dependent still on the bank. Because finally, for example, if user selects net banking, like I can show him preselected net banking, that's okay, but finally he will land on the bank page to enter his credential, do the transaction. And if the bank page are not smooth, so finally, we have to fight Ogi Ogi.
00:20:29
Speaker
I wanted to build a business where I can take the bank out of the picture. So and that is where the wallet concept came in. So I said if the user keeps money with me, then I can get the transaction done without involving bank. Effectively, like I need back only for adding money in the wallet. This was like originally your idea to start the wallet. Yeah, yeah, yeah. And that was very, very radical.
00:20:52
Speaker
Because everybody was like, why will people add money in the wallet? You don't even pay interest. Why would people trust you? And all those conversations happened. And I also did not have an answer. But I was like, if the payment would be solved, this is the only way. I can't see of any other way because there are 40 different banks in the country. Even if one bank or two banks in Prusa, in Fry, it doesn't matter. Because the rest banks will look messed up.
00:21:20
Speaker
The only way to do is to handle it yourself. And then we had started recharging as a use case. I think PTM was basically a recharge company. Recharge company. When you joined. So then I said recharge. And so what happened was like one is the payment failure. But the second we used to what used to also happen is the operator failure, fulfillment failure.
00:21:48
Speaker
So even if the money is debited, like for example, 10% of the time, Airtel site is down or Airtel app is down. BSL used to be very, very down for a longer time. And there were like seven, eight operators at that point of time, like AirSail, Voda, and even like Tata communications, like seven, eight players were there. So what used to happen was like 10% of the transactions were failing from fulfillment point of view.
00:22:18
Speaker
And on the thank you page, we were saying your transaction has failed, take refund, your refund will be processed. And user used to say, and then we realized here, this is a great use case for wallet. So we started telling people that while your transaction has failed, but the money is there in the wallet, you can use it to recharge again, try again.
00:22:46
Speaker
So people said, I have to check because now I don't have to go through that whole payment flow because payment flow itself has like a 30% failure. So every time you try again and there is a chance that 30% of the time it will fail again. So you are like, yeah, the problem comes in as a wallet measure retrial faster. Okay. And then what we said was, okay, you don't have to worry. We'll retry automatically for you for three hours because the money is with me. Whenever the recharge happens, I'll give you the recharge.
00:23:16
Speaker
So customers were like, wow, this is amazing. And what also happened is, as the recharge business grew, the wallet business started growing automatically. The user's use case around wallet education around wallet automatically started happening. Like in about six months, we started doing about 70,000, 100,000 transactions on recharge. And 10%, as I said, was failing. So every day we were effectively creating 10,000 wallets.
00:23:45
Speaker
like 8, 10,000 people were getting taught every day in terms of and what also happens is mobile recharge people used to see there were two things that used to happen. The first thing was that point of time every home had one person who was considered to be good with technology. So, if you are going to recharge, you are going to have to go to the home. If you are going to go to the home, you are going to have to go to the home.
00:24:15
Speaker
because what would happen is, he was expected to deliver he can't say recharge name for whatever reason like you will tell him that he will recharge for whatever reason and now to save his pride, ego etc he has to get the recharge in 10 minutes and now somebody is on hotel within home somebody is on vodha now this guy can't go once to hotel then through vodha
00:24:42
Speaker
What started happening was that this guy then started coming to PTM. And second guy, because now he has to do two, three recharges. So what would happen is rather than adding, rather than doing it through payment gateway every time, he also realized he doesn't have to go through the payment flow again and again.
00:25:10
Speaker
So I think that was a very interesting insight that came in at that point of time. So like these users and typical Indian users are not known to like keep a lot of money with telcos because of the vast business, etc. Like they were uncomfortable. They were not sure of safety of their money.
00:25:31
Speaker
So like people said people used to tell telcos, I am super smart, I am passionate. So people used to recharge like as like it is not like we will keep 1000 rupees with Airtel. So what people started doing is let's keep 1000 rupees with PTM and then keep adding 100 rupees to Airtel rather than keeping 1000 rupees with Airtel.
00:25:58
Speaker
So then things started, the recharge business started scaling and that clearly validated the use case of wallet. So when did it become beyond just recharge like wallet use case expand? Then we applied to RBA for the wallet license and we got the wallet license in I think 2013 and
00:26:21
Speaker
And once we got the reach a wallet use this thing, then we started approaching the outside merchants, like merchants like homeshopper teens, so we book my show, etc. e-commerce companies, e-commerce companies, the aim was to put wallet at a lot of places. And then gradually we started becoming two, 3% of transactions of these companies, which was like bigger than some of the net banking options.
00:26:48
Speaker
And then we integrated with Uber at that point of time. Uber gave us a lot of visibility, PR, et cetera. Now Uber was responsible for me also loading my wallet on PTM. So Uber had two benefits for us. The first benefit was like it brought a lot of those users who are not on PTM. Like I'll say high spending users. And what also happened was like Uber had only PTM for a long time.
00:27:16
Speaker
Like that told merchants, that told consumers that you don't require anything else for payments. ATM is good enough. And suddenly a lot of merchants, a lot of customers started viewing ATM very, very seriously. And like a lot of decision makers were using Uber at any point of time.
00:27:36
Speaker
So, when did you go offline with the QR code?
Introducing QR Codes in India
00:27:39
Speaker
So, we were very clear the offline and some of the flows that we started over like give mobile number to the merchant and OTP will come etc. And we didn't like those flows. We said like it is just too cumbersome. And that is the point of time where the China investment happened. I went to China and to see how things are going. And then that is the point of time we discovered the QR code in China.
00:28:04
Speaker
And we started seeing that everybody in China is using QR code. That is very popular. And we ourselves tried it and we were like, oh, this is very cool. This is very easy. And it doesn't require two-sided effort. Like earlier, I will give the number to somebody, he'll punch in the number, then I'll give the OTP. This is all-time consumer exercise. With QR code, I can just scan at a user side.
00:28:34
Speaker
And I can tell the merchant has a clue. So he has to just check is not doesn't need to be involved. And then we started putting QR codes in the world offline world. Obviously that time QR codes were novelty. People were like not very people didn't understand what is this happening. But like when it caused a lot of curiosity because when you go to a merchant and if you saw someone scanning the QR code looking at taking out his phone and you're like,
00:29:04
Speaker
For a lot of people, it was like a pleasant surprise. Oh, I can feel like this. So a lot of experiment and trials started happening that way. And then like our online penetration became big. The online started becoming big, like offline. It started dropping on the offline world as well. So, sorry, we use time. And then we applied to the bank license. In about six months, we got the bank license. Like we were fairly big.
00:29:34
Speaker
like digital payments that time meant PTM like there were no other close competitors like today when you say I'll message you it automatically means that you'll message me on WhatsApp you don't have to tell me and that time like when you say I'll do the digital payments it meant PTM and what we also did was this was a very interesting which was transferring money through mobile numbers that was also a good hack so like I don't know I don't know with maybe scaling the QR code but if I can know your number I can just transfer money
00:30:04
Speaker
and I don't have to bother over like whether I know your bank account or not like this was like the UPI thing only but we did it with wallet and people were like for a small ticket people were just transferring money like this that also become very very popular so P2P happened P2M happened then the number started shooting up like by the time I left I think we were doing about I think some four five million transactions a day
00:30:34
Speaker
So that was the whole journey at PTM. This was such a powerful journey. From zero, you created India's lead wallet. Why did you leave PTM? Why couldn't they retain you? So you told us a complicated story. I had spent four years, we got the bank license.
00:31:01
Speaker
what was happening was now there was an opportunity that am I ready to spend another 4-5 years to build a bank and I was very very keen to understand why would a user take our bank account like I have already seen that while ICC offered you say 4% interest rate and Kotak offered 6%, somebody offered 7% also it's not that people switched account massively
00:31:31
Speaker
So we were like what will make people switch to us until the time that doesn't happen like wallet you were very clear that it is very convenient to pay. So that value prop was very clear.
00:31:44
Speaker
but with bank account you are trusting a bank as a user with a bigger set of money and how do you build that trust like you can't build a trust overnight like at a individual level also like would I trust ICC to keep my money or would I accept trust PTM to keep my money I think it is very obvious that I like trust ICC to keep my money see even if Tata tomorrow starts a bank like it is not that the people will just move
00:32:13
Speaker
Those people have been banking with somebody, things have been going on fine. It's a large set of money. You don't want to suffer pain. You don't want to suffer surprises. So I said I want to have a clarity around and I want to be convinced myself. And that is the point of time. Like the company wanted to build the whole marketplace business. Like the whole attention was on the marketplace business.
00:32:42
Speaker
And then suddenly the payments became big. Everybody wanted to talk about payment, et cetera. And the founder Vijay was obviously in a rush to launch the launch bank, et cetera. And I wasn't very clear. I said, like, let's first finalize what is the value prop, et cetera. What is the point of rushing? So I had to disconnect with Vijay in terms of how to run the bank.
00:33:12
Speaker
And then I said, that is how it works. Okay. Okay. Okay. So I've read that, uh, you know, that there has been, uh, this kind of, so like, you know, Praveen Jadav who set up Paytm money also quit like Paytm is not able to retain the entrepreneurial people who set up businesses there. Hmm.
00:33:41
Speaker
I don't want to comment that way but every guy who want to build business will need space and will take his calls and till the time complete doesn't allow that level of calling to happen
00:34:01
Speaker
Fundamentally, building businesses means taking a lot of calls. And these calls sometimes may be logical, sometimes may not seem very logical. Intuition. How intuition? Sometimes when I look back, I still can't defend it logically. Why would people keep money at Prityamvallit? How meaningless that interest would be. But why would people keep money? But that is what your intuition is showing you.
00:34:32
Speaker
You can't defend it. Like for example, we Indians, I'll tell you another thing. We Indians have been always brought up with looking at the bill and then paying. Like we go to a supermarket, the guy will say it is 700 rupees. You look at the bill and like computer generated bill. And then you pay.
00:34:55
Speaker
And what happened was when I built the Uber experience, I said, and the guy can move out. And like, like whether within the company, whether with RBI, there were like tons of debates. We Indians are comfortable looking at the bill. And I said, then it is not the experience. Because experience is I can just walk out.
00:35:20
Speaker
and there used to be lot of debate but today it looks very logical auto debates that time remember like uber did not had fixed pricing model only at the end of the trip you would know what is the right price that time it was like only per kilometer or like those kind of stuff
00:35:41
Speaker
But yeah, you're right about that experience. You know, the fact that the destination of the country is not there, it's not there. But the question was so revolutionary, you know, you could not imagine this kind of comfort in using a cab in the pre-PTM Uber days. This is what you believe how the future should be.
00:36:16
Speaker
So, like now these are the calls that need to be taken. These are examples of some of the external calls. Similarly, there are internal calls and what also happens is sometimes these journeys are 0 to 1 journey and whoever has driven that 0 to 1 journey may not necessarily be the right guy for 1 to 100 as well.
00:36:36
Speaker
Because what happens is the bureaucracy is focused on business.
Scaling Startups to Structured Companies
00:36:42
Speaker
Suddenly, you start telling you that you are in a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure that has a structure
00:37:06
Speaker
But you start feeling, why are you interfering unnecessarily? Those things happen. Okay. So you then started looking for your next zero to one journey. So like after PTM, I was home for about five, six months. And typically that's how I operated before PTM. Also I was at home for three months. So I normally take like a three, four months of complete of not doing anything at all.
00:37:36
Speaker
after every stint. So that happened and then that is the point of time the whole Tokopedia I was trying to figure out what to do and incidentally SoftBank as well as Sequoia approached me for their Indian companies and I wasn't very convinced about their Indian companies at that point of time and both of them referred about Tokopedia and I was like India say Barkon Jayega but then
00:38:03
Speaker
I even looked at the Indonesian market. I spent about a week there. I liked the business. I liked the market. And then I said, what is Tokopedia? Tokopedia is like a Flipkart equivalent of Indonesia. Actually, more than Flipkart, it is like a Taobao equivalent of Indonesia. So it's a pure play marketplace. Actually, Indians haven't seen how a pure play marketplace works.
00:38:28
Speaker
Because if you look at Flipkart, if you look at Amazon, these guys stock inventory. These are selling their own. These are also setting their whole prices because they own the inventory. Merchants are not owning. Merchants are not. So like this is more like a like not a market. This is like a branch. It's like online retail, basically.
00:38:50
Speaker
So then I said, I liked the way Toko has built. There were tons of merchants. There were millions of merchants on Tokopedia. Genuine merchants. Tokopedia did not own a single SKU of inventory. Everything was sold by merchants. Customer would select which merchant. Customer would select which payment method. In fact, customer will also select which mode of delivery. So for example, today in India, you don't know whether it is going to be delivered by BlueDart or Kati or like anybody else.
00:39:19
Speaker
customer there would select so like it was a pure play marketplace everywhere so that business scaled up very well in about next two and a half years became like a seven billion dollar business there is about seven billion dollars and raised about a billion dollars at about seven billion valuation by the time I left again from Alibaba and Softbank and that is the point of time my wife was expecting
00:39:44
Speaker
What was your role there, Tokopedia? My role was to build the whole digital and fintech business. So imagine building a whole PTM within a Flipkart. Not only payment, but like PTM has this whole billing thing, PTM has this whole fintech thing. Wallet is another thing. So building all that within Tokopedia was my role. So that happened and that again did very well. And as I said, my wife was expecting the second kid at that point of time.
00:40:12
Speaker
So then I came back, spent about another six or nine months actually doing again nothing. And then I figured out like I was very, what my Indonesian experience taught me was like Indonesia's per capita income was two X of India's per capita income. And this is also what my PTM experience taught me that like while we, when I left PTM we were, I think we're at about 120, 150 million wallets.
00:40:42
Speaker
But the actual transacting frequently transacting wallets, I think were only 20-30 million. It took us a lot of effort for getting the other users to keep transacting. And my realization in both the cases was there were limited Indians with spending power. So the people who have standing power, the Votoj is a hurry.
00:41:09
Speaker
but others it is stuff. So I said like whatever I want to build, I want to build for Indians who are spending power. So the first part of journey was obviously to like build everything for all Indians. But the second part of the journey has been like as a business, it makes sense to spend and I always wanted to always have a social angle to my business. So I was like, how do we improve the life of the people?
00:41:35
Speaker
and then when you look at your city is like parking is a problem, road driving is a problem, like urban infra is a problem, Gadkariji is constructing 30-40 km of road every day and that is changing infra across India but like most of those roads are being constructed outside its main cities like if somebody is constructing 30-40 km of roads every day outside Delhi and my main commute is in Delhi
00:42:05
Speaker
it does not solve my day to day problem that is important for trucks to travel that is important for goods to move that is also important when I go from Delhi to say as sightseeing but it does not impact my day to day stuff. So, that that day to day stuff is a problem. So, I said is it possible for us to improve the quality of living for urban cities in India and this is how the park place thing came in.
00:42:27
Speaker
Okay. So what, what is like the, you know, you would not have done so many things in the first version of the product. You know, tell me about the journey. Like what did you decide to focus on? And then how did you expand the offerings gradually? So I think the first thing we wanted to solve for was the parking problem.
00:42:55
Speaker
So like every customer could easily identify with the parking problem. Like everybody knew that he is spending 5 to 10 minutes every morning figuring out where to park. There is a wastage of time, there is a wastage of fuel and there is a mental stress getting built and then you end up parking on the road which we just congest the road further. So like if we have typically a three-lane road
00:43:22
Speaker
Typically one lane gets reduced, gets out of the equation just because people have parked their cars there. So suddenly road capacity has come down by 33%. Two problems there.
00:43:37
Speaker
So, now what happened was, so we started aggregating supply, going to the suppliers, getting them on board, giving them our app, giving them our Pause devices, etc. What do you mean supplier, like parking lots? Parking operators. Do you like your MCD operators and private operators? Exactly, exactly.
00:44:00
Speaker
So we started getting them on board and we started building the product but at that same time the covid thing happened, lockdown happened etc. Now let's not focus a lot more on parking because that is going to take some time. So we started focusing on building the access control product that we talked about like going to society's
00:44:24
Speaker
like every time you get out of the society it takes you a couple of minutes because the guard will stop you look at the sticker and then manually allow you it's like an irritant every morning every time you go in every time you go out it's an irritant and what also happens is some of the societies who have the windshield and this there are multiple stickers so if you have lived in like for example two three societies you have worked in two three companies
00:44:48
Speaker
the chances are like your car windshield is like a ad dashboard. I have seen people with stickers of PwC, KPMG as well as Eny. There is no way anybody can work in the same company. All three companies at the same time. So everybody is looking at manual stickers. And so I said, is it possible if you can build a singer RFID tag which works everywhere?
00:45:14
Speaker
So, that is the journey where we started with and then we started onboarding corporates, then we started onboarding societies, malls, etc. That is the journey we started with and that is the business we started scaling up fairly well.
Park Plus Innovation
00:45:27
Speaker
Now, like about 12-15% of whole world, about 10% of whole Bombay, 5% of all Bangalore societies, users, tons of corporates like Vatica, Brookfield,
00:45:39
Speaker
these guys Hiranandani, Mindspace, Blackstone all these guys use our system today if you can't go like a kilometer in Gurgaon without crossing a popular society today so that business has been also scaling up well and at the end of the year like we realized that the government is pushing fast tech significantly so we said is it possible for us to build our own network of fast for issuing fast tech
00:46:06
Speaker
So, we tied up with IDFC bank, we became the biggest issuer of fast tech for them. But if the fast tech is built into your single RFID, there is a second. Yeah, fast tech is built in the single RFID system. And who pays for this RFID? Does the car owner pay for it? The society pays for it. Society is pay for this, but most of the time the society is charged the car owner themselves.
00:46:36
Speaker
Like one way or the other, the car owner will pay. And how much does it cost the society to like, you know, what is the economics of it? So typically like at what we have done is rather than the capex model, see, we realize that a lot of societies also had the existing barriers. But most of the time that the barriers won't work because the vendor would have taken the capex money and then he will vanish. Nobody bothered about servicing. So what we said was rather than doing capex, let's do a PEX.
00:47:07
Speaker
like society typically pays about 7000 rupees per gate per month so we have built it in a kind of a rental model so the hardware remains of path plus all the time but society is keeping a rental and from a society point of view it is a great solution because now they don't have to bother about the men and maintaining the hardware that is all path plus hassles what also happens is
00:47:34
Speaker
Like if tomorrow the hardware doesn't work for whatever reason the society doesn't need to pay me. Right. Okay. Okay. So you RFID reader at that boom barrier. Yeah, exactly. Exactly. And you issue whatever number of but you must be charging something per issue of RFID. Yeah. So yeah. So we charge 100 rupees. The RFID tag consists charge get charged for 100 rupees. That's the one time. That's the one time. Take care. Take care. Got it.
00:48:02
Speaker
So, you are competing here with companies like MyGate. So, MyGate is actually a partner because what happens is MyGate looks at the visitors and my solution is a lot more directed towards the residents who have the cars. So, it is a slight nuisance. There is some nuance out there and MyGate is not into hardware.
00:48:30
Speaker
So what we do is we work with them. See, one of the things which most of the Indian entrepreneurs have done wrong in the last few years is they have tried to build everything of their own. Like if you look at PTM, they will say, because now you are competing with them.
00:48:54
Speaker
Similarly, you have also not built your movie ticket business. And the book my show also lost money in competing with you. It doesn't help anyone. Same thing happened for travel. Like you can look at more such examples where people say we want to do everything. See, my idea is very simple. Like build a lot more partners. You don't need to do everything yourself. Like you figure out what do you want to do. And for us, every good thing you get a partner.
00:49:26
Speaker
So like that helps in reducing competition that helps you in also making commercials viable for yourself. And that also helps in improving the quality of your product because now you are not focusing on building tons of things. You're focusing on building specific things which you want to be good at. So we said we integrated with my gate. So my notifications going to my gate app itself. We don't present different solutions to the society. So wherever the my gate solution is available, like we integrate that solution.
00:49:55
Speaker
So this obviously a partnership approach or I'll say collaborative approach is something what I've been focusing on, like, whether it is a society business, whether it is gradually the other parts of the car business. My intent is very, very clear. I want to work with and so partners who would be responsible for doing their fulfillment of services on their side. And I'll tell the customers clearly that this service is provided by this partner. OK, got it.
00:50:24
Speaker
Then you don't really have any direct competitor as such. I guess your competitors will be the CapEx companies, but what happens is not only that, even the companies who do CapEx, like most of the companies in India are traders. They import from China and they put it. Nobody had any kind of a text expertise around how it works, how to solve issues, etc.
00:50:54
Speaker
See, for example, what is happening right now? Oxygen concentrators, oximeters, cylinders, etc. Like every Tom Dick and Harry is trying to import from China and sell it. Nobody has any take understanding of how the product operates, what kind of nuances are in the product. So, India has been the land of traders for long. Like getting deep into a product normally,
00:51:29
Speaker
basic understanding over a period of time about the product but like the way we operate like for example I know that like I do a lot of preventive stuff like for example I know this barrier hasn't opened in the morning from 7 a.m. to 8 a.m. I know automatically so I know like I don't wait for societies to send me a complaint I know it automatically
00:51:55
Speaker
And then we build tons of layers on top of it. Like for example, we allow the guard there itself to complain automatically. I know which car there is a problem. I used to read the tag of this car earlier automatically. All that is system driven. When that is system driven, my complaint rate goes down significantly.
00:52:22
Speaker
So, Abhi, your business lines are basically these two, like the three business lines, access control, parking and fast tag. And then we are adding more business lines.
00:52:34
Speaker
so parking is like a b2c play and these two are more b2b like here you are parking and fast tag is also b2c play access is the b2b access I get paid by the society but the play again is b2c because finally it is a customer like it is not like I'm not installing a electricity meter which the customer doesn't know what I'm installing is this one piece of system which is visible in front of user and if
00:53:03
Speaker
it doesn't work the user has a direct pain so while I get paid by the societies for sure but do you have an app also yeah we have a park plus app which now we are about to touch about a million downloads
00:53:19
Speaker
So what is the app for? Is it for the parking, finding parking? As it's like parking access control, even in access control, what we have made is like a smart access control. Like for example, you can say that this access control, like for example, my car tag should not be read, like you're going out for the next 10 days. Now you don't want somebody in your absence to take out the car from the society. So you can lock the tag.
00:53:49
Speaker
from the app itself every time your car enters the society exits the society you get a notification on the app like you are if you are if you have a 15 year old kid at home and you are sitting at office you never know how many times you take your car out now with this kind of a system
00:54:15
Speaker
you know some notification car like you know then the car is going out coming out. Got it okay and fast tag also probably like charging your fast tag and like that right okay got it okay and so you know what is your
00:54:40
Speaker
roadmap or pathless like next five years road map like what new products do you want to launch or how do you want to scale up the existing products? So the idea is very simple like we are building a global product this problem hasn't been solved globally so idea is like well we build it for India and then they take this product global so build more and more use cases around the car owners on the app on the platform and take it ahead
00:55:10
Speaker
Okay, what are the other use cases you're planning? Like gradually the other use cases would come around like for example, we are partnered with car they go to show second end value of the car. So now the customer within my app itself, like can see what is the value of his car if he wants to sell. So that is one use case we are partnered with echo to sell insurance. That is another use case that we have built. So these are some of the use cases that we have built so far.
00:55:41
Speaker
There will be more use cases that will come in. And when you say you want to go global, does it mean like adjacent market or like west? Like, you know, for example, you will go to first Indonesia and so on or you'll look at? So, I think first we'll look at the Dubai, Singapore, Indonesia kind of markets and then we can go for western market. Okay. And so, in addition to this, like, you know, your three path plus six month period, I think you also did a couple of angel investments. So, tell me about that also.
00:56:13
Speaker
So, okay, so one of the things that I have also realized is like over a period of time, like I had some fairly decent operating experience, like whether it is make matrix or it is paytm, whether it is Tokopedia, and this has been across multiple domains. So I figured out like internet will keep changing things. And finally, internet is the business of young guys.
00:56:39
Speaker
Things will keep changing if you have to keep understanding of how things are getting built. Then you should learn from the other folks rather than just banking on what you learned 5 years back. So I started this journey of Angel Investments about 3-4 years back. Now I would have put in about 15, Angel Investments in about 15 companies. I got a few exits as well. The most notable of them is Bharati. So I put in money in them I think in 2017-18 types.
00:57:07
Speaker
and they have done phenomenally well. Then there are companies like, for example, I put in money in trail, again doing phenomenally well, then putting money in companies like Dalchini, Element Brittle, these kind of companies last year. In the last 18 months, I think I have put in about 10 companies. Hopefully in next 6-12 months, these guys are going to go and raise their next follow on round, etc.
00:57:34
Speaker
What I like about these companies is that these are in different domains and they help you think a lot. They help you figure out. It gives you an opportunity to do a deep interaction with very confident, very strong founders. Understand how they look at business. They all give you a perspective of how they are looking to scale, how they look at opportunity. Like this very enriching kind of a conversation.
00:58:02
Speaker
So I don't do angel investment from a sake of return point of view. If the process is right, returns will come automatically. So I don't need to bother about returns. But what I'm bothering more about is, am I enjoying this journey? Do I enjoy my conversations with the founders? Do I enjoy what these guys are doing?
00:58:22
Speaker
Can I help them in the journey? At least at this stage, see gradually once you go past series A, series B stage, then you can manage things on your own, you have built a network, etc. From screen to series A, series A to series B, that is where I think I am able to help this case. And how does the deal sourcing happen? Like people reach out to you, are you part of some network? So, what has happened is like there is a lot of inbound that comes in very quickly.
00:58:51
Speaker
And then like what happens is like because typically when angel investments happen, 8, 10, 12 angels will come together in a deal. And you interact with other angel guys, then you'll start liking, you'll start understanding which guy is good in what kind of domain, what kind of thought process. And then the inbound happens from the network.
00:59:11
Speaker
So that was Amit talking about his journey as an employee and an entrepreneur. To know more about the offerings of Park Plus for car owners, download the Park Plus app on the Play Store or on your App Store.
00:59:26
Speaker
If you like the Founder Thesis Podcast, then do check out our other shows on subjects like Marketing, Technology, Career Advice, Books and Drama. Visit thepodium.in that is T-H-E-P-O-D-I-U-N dot I-N for a complete list of all our shows.