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The employability edtech for Bharat | Anil Nagar @ Adda247
356 Plays2 years ago
The pandemic has impacted the edtech industry worldwide, and India's edtech giants have been no exception. Adda247 has emerged as a unique player in this space, catering to the bottom of the pyramid with affordable online courses. Anil talks about his mission-driven approach and how it has helped build a successful business.
Additional links:-
1.Bullish on Bharat: here’s how adda247 is helping Indian youth land their dream ‘sarkari’ jobs
2.A pivot that helped adda247 reach tier ii cities and beyond
3.Edtech platform adda247 raises $35m led by Westbridge capital
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Transcript
Introduction: Anil Nagar and Adda 24-7
00:00:00
Speaker
Hi everyone, this is Anil Nagar. I am founder and CEO of Adair 24-7. Adair 24-7 is one of the leading education technology companies in India.
Challenges in the EdTech Market
00:00:20
Speaker
If you've been following the news, then you would surely know that India's ed techs are in trouble and they're laying off thousands of employees. They're now realising the market for a Rs 50,000 online course to crack the entrance exam is very small and that the pandemic boost was temporary.
00:00:35
Speaker
We think that the real problem to be solved is at the bottom of the pyramid and it can be solved only if you are able to sell online courses for a few thousand rupees.
Innovative Strategies and Investment
00:00:45
Speaker
You need a fundamentally different type of organization to sell such courses profitably and this is what ATDA 24-7 has cracked and the VCs have also voted for it by investing more than 60 million dollars in the company till date. In this candid interview with your host Akshay Dutt,
00:01:00
Speaker
Anil Nagar, the founder of ATDA 24.7 shares how his mission-driven approach led to some unique choices by building up ATDA 24.7 and how those choices are fundamentally making them a stronger business. Stay tuned and subscribe to the Founder Thesis Podcast on any audio streaming platform to learn about building mission-driven businesses.
Anil's Inspirational Background
00:01:28
Speaker
I come from a village in UP. It's a small village near Gulen Sher and my parents are farmers. Then we had one school in our village. So I studied in Hindi medium school in my village and we had very small farms. So mostly my father also kept on looking for other avenues to sustain the family and to run the family. I had two younger brothers. I was the eldest.
00:01:53
Speaker
How did you get into IIT after studying in a village school? That was a life-changing thing for me. So I used to study from those Hindi-William books, but in those books there are some questions which they take from IIT exams or these kind of exams. So there was a section in those books where they will collate specific questions which have come in IIT. And then I started wondering
00:02:17
Speaker
whether I should think of clearing this IIT exam and going to IIT. And somehow, confidence came when I could solve some of those questions. The other reason for that was because my background is middle class or poor middle class kind of background. So you hardly survive on your family income. So there is a huge urge to get out of that situation. So as soon as I completed my 12th, I talked to my parents.
00:02:40
Speaker
And so I told them that I want to do this and for that I have to go to Delhi. And most important is that I need money. So somehow I need money. I need 25,000 rupees. 25,000 was big money at the time. So at the time we needed to have at our home, we used to have three or four fellows and the small ones.
00:02:59
Speaker
So my father had to sell one buffalo to give me money. So this is how it happened. They gave me money. I took the bus, went to the administration, came to Delhi. When I came to Delhi, I went to IIT because I did not know anything about IIT. So I talked to the students, and that was very interesting. They made a lot of fun of me. You should go back to your building. So then I entered into premises further, and randomly I entered in one professor's cabin. So there was a professor by the name Keharsing. I think Keharsing was the officer.
00:03:28
Speaker
I did this randomly, so he was doing something, he was writing something. So he told me about a few Gojinn institutes. He said, they play suppose into IIT, which is Sarebri, we have to go there and there are two, three Gojinn institutes. He told me the names also. So I prepared and eventually I got selected also.
00:03:45
Speaker
25,000 was enough because rent and khanapina and all of that. Everything was done. So my monthly expenses were around 200-250 rupees. I used to stay in a very small room. And there was a dhaba where I used to give 150 rupees a month.
00:04:00
Speaker
So I think that was enough and my fee was around 20,000. So I also asked money from my parents, some money, but more or less it was fine. How did you pay for IIT fees that once you cleared? So when I cleared IIT, I got a rank of around 1,100.
00:04:17
Speaker
IIT.
Educational Financial Decisions
00:04:18
Speaker
And then there were these only five or six IITs at the time, seats were around 2500 seats for all IITs. And the options were these five IITs and IIT BHU also. And it was part of BHU with Banars in the university. There was huge difference in the fee of usual IITs and IIT BHU. So, for example, at my time,
00:04:37
Speaker
Fee for IIT Delhi was Rs.10,000 while fee in IIT Biju was Rs.600. So for me, the obvious choice became that I will go to IIT Biju. So they had a scholarship thing also for married holders in that particular bank. So I used to get that scholarship around Rs.3,000 there on a yearly basis. While I was in IIT, my fee was Rs.600. That was the fee, the whole fee. But I used to get from there, not give anything to IIT.
00:05:05
Speaker
everything was covered except for charges. That is everything you have to pay, which usually will come around 700 rupees a month. So that was also a burden for me. So what I did for that was, so there was a rule in our college, if you can take up additional responsibility of managing the mass, then your mass charges are waived off. So I became mass manager there. So I used to manage all along with my studies. So those charges are also waived off.
00:05:31
Speaker
Okay. So then what, like once you were nearing your fourth year, what did you want to do as a career? I want to become IAS officer. So like my fourth year, I started realizing that how I want to think of my life. So one thing I was very clear about was that
00:05:48
Speaker
I want to do it in my own way and I want to read up, I want to experiment in life, I want to play in my life, play my game. So I clearly decided in my
Transition to English Medium
00:05:58
Speaker
fourth year, I don't want to do SEO or any of that kind of job. I will do something private, but eventually I will do something on my own that was also clear to me at that time. How did you adjust to English medium from Hindi medium? And you know, because you would not have even been speaking in English by the time you joined.
00:06:14
Speaker
That was a big challenge. In fact, very big challenge. So, I will tell you when I was preparing for ITJ in Delhi. So, most of my batch mates were from top schools in Delhi. So, I remember people from modern school, people from DPS, BBS, RK, all those guys. They were very smart guys and they used to speak very fluent and really good English.
00:06:34
Speaker
So in my whole preparation of one year, I never asked a single question in my class, not in the usual sense. If I will ask a question, I will be required to ask in English and I will not be able to speak anything and everybody is going to look at me and those things. So I never asked a question. Whenever I had doubts, but originally I had to cope up with it because I started realizing that whatever I do in life, I have to learn English. I should be very comfortable in this speaking and talking in English.
00:07:01
Speaker
When I started working on it, I joined my spoken classes outside my college. I took a lot of efforts, I will say. Did you set for placements, like campus placements? Where did you join?
Early Career Development
00:07:12
Speaker
From my campus, I got placed with Japargash Industries Limited. This is the CEPI group, a daily based. And they were building a hydropower plant here in Shiva. And they hired me as an automation engineer because my branch of engineering was electronics and communication engineering.
00:07:30
Speaker
And in most of the cases, they had foreign engineers who had come to the site and they were doing the commissioning of the plant. They wanted to hire somebody engineers and groom them to take it up and coordinate with those foreigners. Most of the guys came from France or Germany. So they were hiring us to do the learning from them, to take the knowledge from those guys, to understand the whole thing. And once the commissioning is done, we should be able to run the plant properly.
00:07:58
Speaker
and further they had plans to start more projects, more similar I had to power plant projects. So I got placed there. I worked there for around two years when my plant was commissioned. Then I left. There was a lot of learning because mostly I worked with foreigners and they were really good engineers.
00:08:15
Speaker
So why MBA? Like you next you did a MBA right from Go Institute. Yes. So I started realizing that I had done engineering, I had done vtag and was that also I had done work which was very technical. It was typical electronics engineering thing. So I wanted more exposure and also at my head I also thought of doing something on my own. So I thought that one of the way to get broader exposure can be MBA. But big challenge for me was English.
00:08:44
Speaker
Only. So I realized that maths reasoning I can do, but English is going to be a big challenge for me. And when I gave CAD, I scored 99.9% in maths and reasoning. There were three sections of that. But English, I scored 29% time. I got zero calls from any of them. So I knew I was going to do that. Somehow, I also gave this exploration, and then I eventually got a GI points.
00:09:11
Speaker
After GIM, you didn't sit for placements. Yes, I sat for placements. I got placed in companies and technology solutions in the business. So from Goa, I went to Chennai and I was in BFSI vertical. Within BFSI, they had a specific vertical, which was insurance vertical. So I was in insurance vertical and used to look for projects of different companies, which were their clients. And that was your last job with Cognizant?
Mission-Driven Entrepreneurship
00:09:35
Speaker
Yeah, that was my last job. So what made you take the plunge into entrepreneurship?
00:09:40
Speaker
So, when I was in Korgmizan, one day there was a team outing where the vertical head guy had come, the whole management had come and the whole insurance vertical guy. So, we went on an outing somewhere near Chennai, I think it was near Padmichari or someplace. So, we had a good lot of fun in the evening, we were sitting and having beer, all of us. And then our vertical head was asking each of us, how you are feeling in the company? How are you fighting Korgmizan? How's your work? All those things.
00:10:08
Speaker
And everybody was so excited, telling so many good things about the company. Companies, wow, it's an amazing company. Work is so good. And I was sitting and wondering what is good about it. So when my time came, somehow all these things came out of me. I was a bit drunk also, but then I said, it's very boring. I don't find it. And then everybody is looking at me. Who is this guy?
00:10:29
Speaker
But the very next day they transferred me to Gurgaon. They said that we have some projects in Gurgaon, so we have a client maxed in our life insurance. Go to Gurgaon and manage those projects. This is how I, within three, four, once I came to Gurgaon. So that was our client maxed in our life, and I started managing those projects. So I worked there again about one and a half years. So in total, my graduation was two years.
00:10:54
Speaker
It's close to my place and Delhi NCR is very familiar to me. As soon as I came here, my mind started working. I started thinking what to do and what I want to do with my life. This is one of the things which was going on in my mind.
00:11:10
Speaker
that I want to do something for people of my village. I could see a lot of people who had done schooling or graduation, but they're not getting jobs or they are struggling with their career. So I thought, what can I do for them? In fact, whenever I will go to my village, a lot of people will come to me to seek advice and they will ask me all those things.
00:11:29
Speaker
So, in my head, this was going on that I want to do something for these guys. And I will also tell you that since I came from Willy, for me, one of the biggest motivations was that how I will be able to help those people and contribute in their upliftment somehow. What should I do? What can I do for them?
00:11:49
Speaker
I felt that this will be something which will give me the real satisfaction and motive in life. So I was telling my thoughts that what to do and all. So one day my manager from Chennai called me that we have a project in the US. So we have a big client there, MetLife Insurance. And we are thinking that you should go there and manage MetLife.
00:12:11
Speaker
So initially, I was very excited. I thought, this is so exciting. I'll go to the US. I will settle in the US. I will tell everyone, all my friends. I will call and tell them that I'm going to the US. I was so excited about it. But then, and then, everything happened. As the date came close, I started realizing that, is it actually what I want to do in my life? And then the reality came in front of me.
00:12:35
Speaker
I realized that this is not what I want to do. US is not somewhere where I can fulfill my dreams. I can fulfill
Launching Career Power
00:12:42
Speaker
my dreams in India only and I want to stay back. So this was a call for me where I wanted to call my manager that I'm not going to US and the visa thing, everything has happened but somehow now I am feeling that I don't want to go there.
00:12:57
Speaker
But then, as I kept on thinking about it, I realized that if I want to do something, then probably this is the time. And then instead of telling him that I don't want to go to the US, I told him that I don't want to work in an organization. I want to do something on my own. And this is how I left my job. So initially, I went to my village and I started thinking. And then same thing happened that a lot of people I met.
00:13:20
Speaker
a lot of people who are looking for jobs, who are struggling to get placed somewhere. I also figured out that there are some jobs which are in the government sector like banking jobs or railways or teaching jobs, all those kinds of jobs are there. So I also started guiding those people that, okay, these vacancies are coming, go and start preparing for these exams. And then these guys will come to me that we are taking care of the world, how to prepare for the exam.
00:13:46
Speaker
So for a few weeks I got at my home and then I realized that maybe this is where I can contribute, this is where I can help. A lot of people are looking for these jobs and maybe I can guide them, teach them. So with that thought I came to Noida. Noida is like close to my place and I started this physical coaching by the name Carrier Power. So I thought I will teach.
00:14:07
Speaker
And we'll do workshops. We'll go to nearby villages, towns. We'll conduct workshops. And then we'll tell these guys that if you want to prepare, then you can come to Noida and we'll give you the coaching. We'll help you in correcting good exams. This is how we started Career Power. Career Power was a typical offline coaching, just like career launcher Rajar Fidji, where I started teaching. And as soon as I started it, within a month, I also met two guys, Saurav Bansal and Nikhil Akbar. They also joined me as Kufa.
00:14:37
Speaker
in the journey. Three of us used to teach and this is how our entrepreneurial journey started. And so like Nikhil Aggarwal's name is somewhat familiar to me. I may have met him. Is Nikhil still with you? Nikhil is not with me. I think after two or three years Nikhil left and 2010 was the time when the internet was not too much being used, devices were not there, Android was not there too much, data was very high.
00:15:00
Speaker
So internet was practically not there and funding was also practically not there. Did you ever think of funding? Because I mean, coaching business is like cash upfront business. You don't need funding as such. Yes. In those times, we never thought of funding. Your way of customer acquisition was through free workshops. Like you would do free workshops and through that you would get enrollments.
00:15:20
Speaker
Yeah, to begin with, in the initial few months. Also, we used to put a lot of posters in nearby places. And most of the cases, I was the one who was putting posters on the walls. And what were you saying then? Like, which exams? Was it IT entrance exams, or was it like bank PO? So these were exams for various kinds of government jobs. For example, banking jobs. So in banks, there are various kinds of jobs, like bank PO, or bank clerical jobs, or specialist office jobs, like finance officer, marketing officer.
00:15:50
Speaker
IT officer. So all those kinds of jobs are there in banks. Similarly, there are various kinds of teaching jobs or in central government schools. But after six months, then I think it became word of mouth business because our results were kind of phenomenal. In the first place, we had around 39 or 32 ends. Out of that, around 25 were selected. And that word of mouth spread very fast. And we started expanding very fast.
00:16:14
Speaker
So initial, the center was in Noida. Within a year, we started our second center in Delhi. And then within six months, we had, I think, three, four centers in Delhi. Within two years, we had lunches. Company-owned, company-operated branches are like franchising.
00:16:30
Speaker
All companies. So after Delhi, we went to Lucknow, Kanpur, then Padnaayam, Devadopal, Rajeev. By 2016, we were running around 100 branches of career power and all across.
00:16:46
Speaker
How did you scale from 1 to 100? Quality of education, keeping that consistent is so challenging and very few companies are able to go beyond a couple of branches. What was your way to scale up?
Scaling and Quality in Education
00:17:02
Speaker
So generally, I will tell you when we were growing and expanding offline. First of all, practically, I was involved in everything. For example, if I had to set up a branch in Lucknow, so I will go to Lucknow and I myself will set up the branch. We used to look for education hubs where a lot of students are staying or these are there or near to college or universities. So first of all, this and we also needed a place which is highly visible so that people coming from
00:17:30
Speaker
We are coming here to that place, they can see it clearly. We will build the branch. The physical setup will be done, let's say, in a week. Then we will start a batch. Normally, I will start the batch. I will take the first class in that enter. While in the first week, the setup is being done, I will also do the hiring of teachers. We will guide them into some extent.
00:17:50
Speaker
And for 2-3 weeks, I will be there till everything is smooth and running and everything has figured out what to do and how to do, how to go out marketing and how to take classes and everything. So likewise, we used to monitor it very closely. You set up everything on our own.
00:18:05
Speaker
And it worked really well. We faced challenges when it came to opening centres in non-Hindi speaking states. For example, when we were opening centre in Chennai, then we had to face some challenges because there were a lot of communication gaps and people used to treat us that somebody from Delhi or Hindi speaking well has come and probably will catch their things and will do something wrong there. So, those kind of situations we faced challenges but
00:18:35
Speaker
Mostly you are able to bring them in a running state at a very faster pace because I will be there, I will be talking personally, people know me. So one of the good thing about us was that company reputation, founder reputation was used. People used to think that, okay, this is the company and they do, I will tell you,
00:18:53
Speaker
There is a reason for that also. In offline, especially in government, S-PREP, it is a highly fragmented segment. There are so many physical coaching institutes. There is no one, which is variable, but at a smaller level, there are thousands or tens of thousands. And there are a lot of unprofessionalism there. They are run by some teachers or local people.
00:19:14
Speaker
So there's no standardization, there's no field, company like field or let's say the basic facilities for employees or basic things which should be given to employees. Like my background is from IIT and my co-founder is also, he also comes with a good background, educational background. He was working as a banker. So we built the company very professionally and that also became a differentiator in the industry that, okay, this is the company which is doing things highly professionally.
00:19:40
Speaker
This is the company which gives you so many facilities. This is the company where you can also get respect when it comes to teachers or let's say any kind of employee because normally in offline people treat employees in a bad manner. And how did you ensure that the faculty is teaching the same thing everywhere? Like all 100 centers have the same quality of education?
00:20:02
Speaker
So we created the content and we created the modules that say we are launching a batch for banking. It will have let's say 50 modules or 100 modules. Out of that 10 modules will be maths. In maths there will be these modules.
00:20:18
Speaker
there will be assignments. So we standardized that every class, this is the assignment you have to do. And we kept it open that teacher can teach in their own style, own way. But outcome should be that this one should be able to do these 20 questions. There were around 20 questions in that. Also the initial content was created by us only. I gave it the math content on my own. So I used to need, so I knew that what is relevant, what is not, and what is the depth required.
00:20:43
Speaker
So I created the initial math content, similarly solve a grid, something Nikhil also created. So we had a lot of control over the content that what is the content which we are going to teach or what our teachers. Okay. Okay. Okay. And what would one center like what was your revenue per center per month or like give me some idea of revenue numbers by 2016.
00:21:02
Speaker
So, I will tell you overall revenue. So, overall revenue was around 25 crore we were doing. But there was a huge difference in terms of between different centers. For example, in a city or a bigger city, revenue might go
00:21:19
Speaker
As high as, let's say in a month, you can do 40-50 lakh also. And in a small place, it can be 2-3 lakh also. So anywhere in this, it will also depend on the stage of the branch. For example, initial success will be a bit struggle, but after one year or two years, then the revenue will start. Were you using any technology to manage this? Like any digital tools or was it done through the traditional methods?
00:21:47
Speaker
Mostly traditional, we had created some tools, internal tools for ourselves, but very limited. Mostly we'll use mails or we used to do Google spreadsheets, but not too much of tech by the time. So it's 2016. You have a hundred centers offline for career power with revenues touching 25 CR.
Transitioning to Online Education
00:22:08
Speaker
So, you know, what next from here?
00:22:10
Speaker
So around the time we started realizing two, three main challenges, I will talk about that. One of the big challenge we were facing at the time was quality challenges because there was too much of operations. We were running so many centers and number of faculties were huge numbers.
00:22:26
Speaker
So it was very difficult to maintain the quality across so many different locations. So we had a few locations where a number of classrooms were like 15 or 20 classrooms also. Even at one location, we had challenges. And we had so many different locations in so many different languages. For example, we had branch in Chennai. So while we are trying to maintain the quality there and provide the students the best quality, we were also facing challenges because we did not understand language there. So personally, I did not understand.
00:22:56
Speaker
So I also used to have someone in between who will audit, who will tag, who will report to me. So that was one challenge, which we started facing by the huge offline ecosystem. The other challenge was growth challenge. We also started realizing that, what next? So we had these branches in all major cities in India. And if you wanted to think beyond it, then we had to go to relatively smaller places. And the challenge was that we still had some branches at these small locations.
00:23:25
Speaker
But in most of the cases, these branches were lost making financially because you set up a branch in, let's say, a small location. Number of students which you expect will be relatively low and you still want to ensure that you provide the best quality there. So your cost, overall cost goes away and then you struggle there because of your low number of admissions.
00:23:46
Speaker
So we thought that this is like another challenge. So keeping these two factors in mind, we thought that we should find some solution. The other factor which we had in our mind was that when we started the company, we had a clear vision that we want to serve people coming from smaller places. This company is for people who have been deprived in terms of quality education.
00:24:07
Speaker
We started realizing that if we eventually, if we remain limited to bigger cities and we don't go to smaller places, then our vision of serving people in smaller places will also get impacted. We started thinking of a way how we can solve all these three problems.
00:24:26
Speaker
And there was also the time when Jio was launched and even in terms of device, a lot of smartphones were coming to India, a lot of cheap smartphones were there and people were using smartphones and internet quite a lot at the time because I think about a year Jio was almost free and data charges were very low. So then we realized that probably going online is the right way.
00:24:48
Speaker
to achieve our vision also, and to take quality education to every home in India. So we had two options then. One option was to start something in online mode within the carrier power ecosystem. And this is what generally most of the companies do. Most of the offline companies, they become big. And then if they want to go online, generally the strategy is that within their ecosystem, they hire a few employees. And through them, they want to enter online. So this was one option.
00:25:15
Speaker
Other option was that we completely shut down everything in carrier power and again start from scratch and build a new company which will serve online mode. The second one is very risky proposition because it's like starting a new company and closing down a popular profitable high-growth company and we're going very well. So in 2016 we grew more than 100% as compared to previous year.
00:25:39
Speaker
So, so this was very tricky and very difficult call for us. We chose the second one, second option that we will not do offline and we will completely go online and we will not do it like we started within career power ecosystem, hire a few of these and they will build online for us.
00:25:54
Speaker
We realized this is not going to work. The company is all about this DNA. And if we want to build online with an offline DNA, probably it might not happen. And you have 25 crores of revenue coming in from career power. You wanted to just shut it down, get that to zero. Yes. So that's a call we do. And so this, in insight, it was very vulnerable by us. But I still feel surprised that my co-founder, he supported me on this big deal.
00:26:21
Speaker
And you had no investors in the business, so therefore it was? No investors at all. That was a blessing, I will say, because then you are not answer to anyone. Even if you fail, it is just you. So it was a big call. How did you shut down? Did you just give a one month notice to all employees and your landlords from your rented properties that this is our last month of operation? How did that happen?
00:26:45
Speaker
No, it was very difficult. In many cases, students have long courses, people are studying for one year, right? And they have so much trust on you. While you have different aspirations, you want to build online, but at the same time, you cannot play with their careers and their emotions. So we decided that I will dissociate myself from career power. So our head office was in Nagar, Lakshmi Nagar Delhi. So I moved to Urgau.
00:27:07
Speaker
I started a new office in Gurgaon, in UNITEX, Ivarapar, and started working online. So let's say that was 31 January 2016 around that. And I started this office in Gurgaon. I started hiring tag and product guys here. At the same time, Asara stayed in Lakshmi Nagar. And we together made a plan that slowly this is the road we are going to take. In six months, we are going to close this branch. In one year, we will close this. In, let's say, one year or in two years, three years, this is going to the roadmap.
00:27:37
Speaker
So our strategy was that probably in six months to one year, we will close down all the branches which are in smaller cities. And for bigger cities, we made a plan that the other option to take care of those branches was to convert them into franchisee. Because most of the branches in bigger cities are company owned, and there are a lot of takers who would like to run these branches and continue with that.
00:27:58
Speaker
So let's keep career power alive in some format, maybe in franchisee, so that tomorrow, if we want to utilize that ecosystem for supporting our online store and so on, ecosystem, probably we can do that. So this was the thought. And yeah, and slowly we, here we closed down 25 branches and so on. So as on today also, we have around, I think 30, 35 branches of career power, all franchisees, all universities, all franchisees, but every contribution will be like one or 2% of the overall revenue.
00:28:27
Speaker
So they are alive in a way. But operationally, we are not involved. Our complete adoption focus is building online. So how did you do your zero to one for online product?
00:28:38
Speaker
Online was a totally different journey. Offline was all about operations. You're going to have regular classes, batches, too much of ops. But online was more of an intellectual thing. And I built a very solid team which can take care and which can build this great product. We chose that this new business or new product is going to be added 24-7, which is basically a law of education. So everything of education will be there on this platform. Anybody can come and prepare for any exam. So that was the thought.
00:29:06
Speaker
initially when we thought of a 24-7 and we were very choosy so i will say we had a bit clarity on this that if you want to build a great product it can happen only if we have the best people in the industry and at that time we hired some of the best people in the ecosystem we paid very high salaries even though we did not have any funding but we had cash which came from offline it must have needed for you to learn
00:29:29
Speaker
a completely new type of skills, right? Like from growing an offline business to setting up an online business. How did you personally cope with it? What were the skills that you had to learn in order to build an online business? True, true. This is very much true. In fact, Akshay, I will say that this is true at every stage of the business.
00:29:47
Speaker
So let's say when you are building a business, which is like doing one corrupt business. So you require a different disk inside. Tomorrow you are doing a business or you want to build a business which will do 50 corrupt. It's a different disk, 100 corrupt different disk. So every stage you have to upgrade yourself and you have to change your role also. Initially, when we started building this product, I was involved in everything.
00:30:09
Speaker
everything in terms of conceptualization, in terms of product, how the flow is going to happen, where students will consume, how they will consume, what message they will get, what will be the pop-up. So I was enrolled in everything. On the tech side, I relied on my tech guys, although I was very keen to go into tech.
00:30:29
Speaker
Tempted to do some coding also, which I did not do. I had very solid tech team, and one of the tech guys over at CTO was very strong in that. So tech I could completely avoid because I was kind of taking care there. But on product side, on analytics, I had to learn a lot that in offline, there was no analytics. It was all here. It's all very sophisticated. Every product decision is taken on the basis of data. And you have to understand what is the flow of data,
00:30:56
Speaker
how, what kind of analytics you can measure or you can capture and based that how you take your disease. What is the strategy you took? Like, you know, there are multiple strategies. Yeah. So we, we did multiple experiments. We tried multiple things and some cases it worked. Some cases did not work. So for example, in 2016, as soon as we launched the platform, the first thing in terms of paid course was our mock test series.
Launching Adda 24-7: Challenges and Strategies
00:31:21
Speaker
For example, you can practice for any exam before you actually give the exam.
00:31:25
Speaker
That worked really well. But the challenge with that product was that it was very low ticket size product. 100 rupees, 200 rupees kind of product. So we realized that this is fine, but we have to think of something else or something bigger where we can get more from our users. And we have to think of a service where they get the value. So after this, the next product we launched was tablet-based courses. So here likewise, it was very much likewise.
00:31:50
Speaker
So what we said that you can buy your course. So we will send you the tablet and it has everything. So you can prepare for from that. But then it did not work out so well. Self-learning. So this did not work out so well. Why did it not work out? Was it a motivation issue? I mean, I've always felt self-learning. The big question is motivation there. No. So for us, it was a different challenge. So most of our audience is in smaller places, tier two, tier three, towns, villages.
00:32:15
Speaker
and when we started selling the course most of the people let's say were buying the course buying the tablets from villages and towns so and this whole delivery ecosystem was broken I don't know as of now what is the situation but it was very difficult in those days that you deliver this particular tablet to someone in a village so in cities like delivery happens but in villages it's not happened
00:32:38
Speaker
So we started getting so many complaints that our product is one month, that has not reached two months. So we thought that we are creating unnecessary negativity out of our product. And it's not our product. It's our delivery that things are not reaching to our audience. So we thought that no, it's not going to work. While these guys had internet in their village.
00:32:59
Speaker
delivery is not happening. So that was seven for us. So then we moved on to live learning. Then we said that rather than having these video courses and self-based courses, let's provide live courses. And live courses work really well for us. So till now live courses like... Why did you move to live courses? You could have done that self-based learning without a tablet delivery, like just through downloading an app.
00:33:22
Speaker
Right, right. So we tried that also, self-paced learning initially, but then we realized that if somebody is downloading the content online, so at the same time, we can also provide live lessons, which is more interactive, which can cater to many different things. Because when we were thinking of a tablet, our thought process was that people in smaller places, they may not have proper access to internet. So tablets make sense for them so that they can consume the content even without internet.
00:33:50
Speaker
But then internet penetration was increasing very rapidly. So that problem actually was not there. Internet was there. In some cases it was slow, intermittent, all those problems were there. But in our minds, this was a big problem we wanted to solve. That people who are in smaller places, they don't have access to proper device and proper internet. And if we send them the device with the content, then this is going to solve some problem. But then we got to do some other problem. Delivery was not happening.
00:34:18
Speaker
So when we tried to record it through online, which was like streaming, then we thought that why we want to give a recorded thing if it is streaming. We'll give them anything so that they can ask questions, they can talk, they can express themselves. That was a thought. And was it cohort based? Like when cohort would join together or was it like flexible? Anyone can join at any point of time.
00:34:40
Speaker
No, anyone can join any point of time. So we start launching batches just like offline. And these were in online mode with so many other features. But they were batches at certain timings. For example, we launched it to one course, which would happen every day, seven to nine in the morning. Or there is a batch. This is going to start the evening, six to eight. So every day, two hours class for the next three months. So we can separate those kind of batches, and then we start. Very similar to offline world, the way you designed the product. OK, OK, OK.
00:35:09
Speaker
How did you replicate the community building which happens offline? Like, you know, when there are 50 students sitting in a class, they make friends and they ask each other doubts and things like that. Were you able to replicate that in online? Yes, yes. So we solved that through tech. So while on our website, we had all these features because we realized that a lot of people were coming online while seeking information. They wanted to know which exam is coming or what is the salary or what was the previous paper, what was the cut off.
00:35:38
Speaker
All these guys are coming out online and we created communities around that where people can talk, they can ask questions and they can solve their doubts between them only. And this worked really well for us. We could see that every day we were getting lags of chats by different people they were talking.
00:35:55
Speaker
Same thing you replicated on our app also. So people don't share content, they can like, they can chat, they can talk to each other. So this whole ecosystem was replicated on app also. And for us, I think it was a bit differentiator also because otherwise in most of the platforms, it was just content, right? You go and you consume the content or you leave. But here people will come to talk to each other.
00:36:19
Speaker
that okay how are you preparing now 10 days are remaining what is yours to read what books you are reading or this question i could not solve we we we brought all those just an rf and web but i will say true success came in or we became more confident when live started working really well and that was around 2017
00:36:40
Speaker
And then we knew that now this can be scaled to any level. There's no challenge around pricing. So this 2018, what kind of pricing did you have for your life course? And what was the turnover monthly revenues or annual revenue you did?
00:36:54
Speaker
I don't remember exactly but in the first year we had a total revenue of around 2.5 crore. We did and the next year we did around 6. And most of the journey has been around growing 100% year on year. So also we did not grow very exceptionally in any of the year but we grew consistently.
00:37:13
Speaker
Every year we kept on adding new courses, we kept on trying new products or new kind of courses for our students and it kept on. In 2016, we raised our first round of funding, which was done by Easterlight Technologies Limited, I'd say with another group of three. So they invested around three million dollars. That helped us in terms of building our basic tech and basic content.
00:37:33
Speaker
The initial things were taken care of by that. But we got the confidence when we raised funding by Infoyas in 2019. Infoyas invested in Infoyas along with Asha Impact. They invested around 30 crore. And then we kind of realized that funds like Infoyas, they feel that we have the potential and we can change things in India. Then we are going to do it.
00:37:53
Speaker
What did Infos see in you? What was their reason to invest? I think one of the things they had in mind was that this is a big market anyways and we were the largest player in that segment 2019 catering specifically to that segment. So, Infos, one of the business they manage is nofi.com.
00:38:14
Speaker
which is around jobs or private sector jobs. They saw that there is parallel market, which is government sector jobs and the largest player wasn't in that segment. So that was one. The other was, I think, the way we were building business. So we were building business in a very sustainable, in a very cost efficient way. So I think they also liked that in terms of our DNA. I think Sandeep Sal met me and kind of, I felt that
00:38:41
Speaker
And voice is also very conscious in terms of quality of founders. So there also I feel that it worked well for us. Right. It was a big step of approval for you. And this would have then helped you further to reach where you raised 20 million in 2021, 35 million. So like 55 million you raised in the last two years, which is pretty amazing.
00:39:01
Speaker
Right. Right. This really, this was like, I will say in funding ecosystem or tag ecosystem, this was a big validation and then things were, things followed. What is your sales strategy? How do you acquire customers?
Growth Through Organic Content
00:39:15
Speaker
Is it through performance marketing or is it like TV ads or celebrity endorsements or like, you know, what's your strategy on that side?
00:39:23
Speaker
So we don't do any of these. We hardly do performance, we don't have any salary, we don't do all these things. What we do is we have built a very strong organic ecosystem. Organic ecosystem on webinars around search and as well as on YouTube. So we run multiple websites which are focused around different exams and there we provide all information content free of cost. For example, we have a website bankercenter.com.
00:39:50
Speaker
So, if you want to know anything about bank exams, which new exam is coming up, what is the salary or what is the career path, anything you want to know, this is the one-stop platform for all the parents. And it's a big success. Similarly, for teaching jobs, we have a portal, TeachUsInDA.com. Similarly, there is a portal for defense guides, which is called Defense InDA.
00:40:12
Speaker
So we created multiple websites. These are informational websites free of cost. So anybody, let's say either directly lands on the website or let's say such is on Google that I want to prepare for this exam. Ultimately we land on one of our portal. Right. So that's one. And in this, this whole organic ecosystem.
00:40:30
Speaker
organic web ecosystem, we get about 25 to 30 million users every month. That's one user acquisition channel. It's all free. Users know marketing. The other channel is YouTube. So as of now, we run 50 different YouTube channels, gathering two different exams and different languages. Last year, we had about more than 2 billion views on these platforms.
00:40:51
Speaker
And from our strategy is that these are the YouTube app or these are informational platforms. From there, we as users that if you really want to prepare the part, let's say you have the complete course, then visit the app, download the app and within the app you can buy the course and you can prepare for your exam. So you basically invest a lot in creating content which generates organic lead. Yes, yes. Tell me something, how important is it to, what is the importance of
00:41:19
Speaker
Being vernacular, adopting vernacular languages. I spoke previously about how you struggled with your Chennai center and you told me just now that on YouTube you have channels in different languages. Is this important for a net tech to embrace vernacular or do you teach primarily in English? I think vernacular is key if you really want to impact education in India.
00:41:41
Speaker
So what we are saying is that Adda is a company which is changed to education in smaller places or take education to those people who have been deprived of education. Now all those people even in smaller places. Now let's think of Tamil Nadu and think of a small place in Tamil Nadu.
00:41:58
Speaker
Somebody is staying in town or a village in Tamil. How you get to ask for his life? Okay, you will say that I have a quality education. I want to give quality education. So now, what should be the language? Should it be Hindi? Should it be English or Tamil? So the obvious answer is it should be in Tamil because somebody is staying in a village in Tamil Nadu can only understand Tamil. Otherwise, what you are saying is that if you want to provide education in English, then it's like a very small set of people in India, maybe
00:42:26
Speaker
less than 5%. But if you really want to impact people in villages, then the key is that you have to provide education in their local language, in their native language. So this was very clear to us in the beginning. In fact, when we raised funding from Infoyars, and the pitch he gave to them was that our strategy is to take education to every town, every village, every home in India. And our nuclear is the key.
00:42:51
Speaker
We want funds because till that time, 2019, we were providing education only in Hindi and English. Although Hindi is also like vernacular and catering to certain states but again it does not cater to the whole India. So as soon as we launched our courses in four world languages and those were Tamil,
00:43:10
Speaker
Telugu, Marathi and Bengali. So I think vernacular is key definitely and I can say that as of now in India there is no other education technology company which is focusing on vernacular or as much as we are focusing. Are the exams in English or are the exams also held in? I mean if someone is learning in Tamil, will he give the exam in Tamil or will he give the exam in English? All state exams happen in local language.
00:43:35
Speaker
So for example, or you would like say the SBI bank PO that's available in local languages also. So few exams may not be there in local languages. For example, SBI clerk is available in local language. SBI PO may not be available, but SBI PO is like slightly on a higher side. So somebody who has done graduation or who has certain level of education.
00:43:56
Speaker
So as soon as you reach certain level, then English is okay. But after a certain level, if you want to bet everyone, then local language becomes
The Competitive Exam Market in India
00:44:06
Speaker
a key. How big is this market? How many jobs are available each year through these exams? Roughly half a million jobs, around five lakhs.
00:44:17
Speaker
Half a million jobs. Wow. Okay. And how many people are aspiring for these jobs? Roughly 80 million people. Wow. 80 million for half a million jobs. That's incredible. So which is why you need the preparation. Without that, you will never be able to get into that top 5%. Basically only like 5% of aspirants end up getting a job or less than that. 0.5%.
00:44:39
Speaker
0.5 oh man okay amazing okay so what is your like number of students you teach every year so we teach in last many years we had around about a million users an update from million paid users so there is a lot of market still available for you to capture basically like this yes there's not so many since 79 million more test takers who are potential market for you amazing and what's your average earning per student or you know like what kind of revenue are you doing
00:45:08
Speaker
So as of now, we roughly, it's about 2000 rupees per user, which we take. So for example, we are doing a current trend rate is around 20 crore, which we do, as of now, doing more monthly, which is like one like 80,000 to one likes to end every month. And what is the competitive landscape today? Like, you know, you told me in 16, 17, there wasn't much competition for you. The other players were focused on different segments of the market. No one was exactly in this segment. What is it like today?
00:45:37
Speaker
in between many different attacks came and went. According to you, what are the reasons that you survived and the others did not? Is it vernacular? Is it pricing? Because your pricing is pretty low right now. 2000 rupees per student. This sustainability bit is in the DNA of the company. So it's not about pricing because initially when we used to talk to investors, then people used to say that this is a huge audience which comes from year two to year three.
00:46:03
Speaker
But the problem is that the paying capacity is very low. So you can never build a sustainable business from this lot. And everybody used to question that. And in our mind, we used to think that, yeah, paying capacity may be low, but it's a huge volume. And maybe we can build a business where we can offset this lower pricing through volume. A lot of people can operate from it. Eventually, we can build a sustainable, profitable business.
00:46:27
Speaker
That's an approach we always had because we are getting to a big audience, a huge number of people. Our business is going to be a volume business. A lot of people are going to come to our platform and buy courses. We are also very clear that if we really want to crack this market, two things are going to matter the most. One is affordability.
00:46:49
Speaker
that we have to provide affordable education because these guys cannot pay 1 lakh rupees or 2 lakh rupees or these kind of prices. They can pay 1,000 rupees, 2,000 rupees or 5,000 rupees. This is one. And second is vernacular that you cannot expect that they are going to buy your course in English language or Hindi language. They are going to buy in their own language. So for us, these are the two core things
00:47:12
Speaker
that we want to make courses as affordable as possible. And beyond that, the other thing is that our DNA is to do business sustainably and profitably. Okay. Do you think you raised too much money? $55 million you raised in the last two years and you're a company which doesn't burn money for customer acquisition. Most companies raise for customer acquisition costs, which in your case is largely organic. Your revenue, like that average revenue per student is also fairly low.
00:47:41
Speaker
Looking at that, it seems like a very large number to raise 55 million. Yeah. So we have done two rounds recently. One was in 2021, in November, where we raised 20 million, which was mix of primary and secondary. But primary capital I would say was around 100 crore. And on that, out of that 100 crore, we spent some money on acquisition of another attack, which was study IQ education. So we acquired that caught me immediately after our fundraise.
00:48:08
Speaker
So we spent some money on that, some money we still had out of that and we recently raised another $35 million. So if I frankly tell you about our bank balance, so the current money we still have around the bank and the remaining money from the last round we still have with us in our accounts. We were never a fan of raising too much money because we know that every time you are going to dilute your equity and our intent is to build this company for a longer term. For next at least 20 years I want to continue building this company.
00:48:37
Speaker
But at the same time, you also want to be comfortable in terms of exploring new opportunities, entering into new domains and strengthening yourself time
Financial Resilience and Future Opportunities
00:48:47
Speaker
to time. Because in the past, what we have seen is that some of these new attacks come and they will suddenly raise some money and will disturb you through that money.
00:48:59
Speaker
So we want to be in a relatively strong position when it comes to such scenarios. And also, we want to be comfortable in terms of our cash, in terms of exploring new opportunities. So suppose in today's times, when most of the attacks are suffering due to lack of funding or due to bad markets. So we are in a very good position in terms of exploring opportunities, buying new companies, acquiring different companies. So yeah, that was the thought process behind this.
00:49:28
Speaker
Why did you acquire StudyIQ? What's their product? What do they do? So they are into UPSC segment and a very popular brand in UPSC segment. So they run a YouTube channel by the name of StudyIQ IAS and they have around 14 million subscribers there and every single day they will have around four to five million views on
00:49:49
Speaker
their channel that's highly popular platform for upses parents and we wanted to enter so earlier before is today we were in all government test rep segments except upses so we wanted to enter upses and they were kind of perfect fit because they come with the same dna building sustainably building organic platforms.
00:50:07
Speaker
And what do you see as areas you want to expand into? What kind of companies would you like to acquire? Is it to add new product line or is it to acquire companies which have built up a strong community of followers on social media? One of the aspects we want to see in the companies which we want to evaluate is the organic user base. They have built or they are building because that's our DNA.
00:50:32
Speaker
We don't want to spend too much on paid marketing. We want the organic ecosystem because that comes with a lot of user validation and also customer equation cost suddenly becomes zero. But otherwise, we want to enter into segments which are in alignment with our audience. Now our audience is, let's say, people are staying in small places.
00:50:50
Speaker
So time to time, we want to think that what are their educational needs? What is that we are not capturing as of now? And can we do something there? For example, one of the spaces we are exploring as of now is upscaling or affordable upscaling, where we want to visualize that, OK, a lot of people come to our platform for government jobs. Or let's say 80 million people are filling the forms for government jobs.
00:51:13
Speaker
But out of those 80 million, hardly half million get jobs. So can we do something about for those people who do not get job environment sector? So maybe we can do some kind of digital skill, we can give them so that they can do some kind of job, maybe from their location itself, and they can be productive and contribute to DRCDP.
Anil's Advice to Entrepreneurs
00:51:33
Speaker
So what's your advice to aspiring founders? Okay. So my advice will be that building a startup is a long journey. And if you really want to build a great startup, come with a complete conviction that this is what you want to do. There will be one thing which I know for sure that when you start your entrepreneurial journey, things are not going to be as per your plan. You will be surprised as soon as you start doing your things.
00:51:58
Speaker
everything will change within a year. People who talk to you, who say a lot of good things about you, suddenly they will change, or let's say people will start questioning your decision. So a lot of things are going, and even for your product, let's say you are convinced in something, but as soon as you start, you will realize that, no, this is already taking care, people are already doing it. So a lot of things are going to happen, but you should start the journey with a conviction that this is the problem statement, I'm going to solve it,
00:52:27
Speaker
But in the end, you are going to enjoy and unleash every moment of it. It's so much of learning and that perspective is so much of fun. It gives you so much sense of satisfaction in terms of achieving what you are achieving.
00:52:42
Speaker
And that brings us to the end of this conversation. I want to ask you for a favor now. Did you like listening to the show? I'd love to hear your feedback about it. Do you have your own startup ideas? I'd love to hear them. Do you have questions for any of the guests that you heard about in the show? I'd love to get your questions and pass them on to the guests. Write to me at adatthepodium.in. That's adatthepodium.in.