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Masterclass: Building Viral Digital Brands in India | Anirudh Pandita (Pocket Aces & Loco)
301 Plays2 years ago
"The default state of your business is usually dead." This stark insight from Anirudh Pandita, founder of Pocket Aces and Loco, underscores the harsh reality of entrepreneurship. It’s a reminder that survival and success are not givens, but outcomes of relentless effort, strategic pivots, and often, a bit of luck with timing.
Anirudh Pandita is the co-founder of digital entertainment company Pocket Aces and founder of India's leading game streaming platform, Loco. An ex-investment banker with an engineering degree from the University of Illinois Urbana-Champaign and an MBA from Wharton, Anirudh transitioned to entrepreneurship, building Pocket Aces to a company reaching 70-80 million people weekly and reportedly in the ₹100-200 crore revenue range. Loco, after being spun off, raised over $50 million ($9M seed and $42M Series A), and its earlier trivia app avatar was once the fastest to hit 1 million daily active users in India.
Key Insights from the Conversation:
- The Accidental Entrepreneur: Anirudh initially had ambitions to start a business but no clear path or family background in it, leading him through Wall Street to understand how businesses are built before taking the entrepreneurial plunge.
- Pivoting for Product-Market Fit: Pocket Aces started with an idea for films but quickly pivoted to digital content for mobile-first Indian youth upon recognizing the slow pace of the film industry and the shifting media consumption habits.
- Experimentation and Virality: The success of FilterCopy came from a culture of experimentation which helped identify what content resonated with audiences, while the initial version of Loco as a live trivia app achieved massive virality due to a unique interactive experience.
- Building a Moat with Community: Loco's shift to game streaming was driven by the insight that gaming was becoming a massive content category, and the strategy focused on building a strong community of gamers and streamers, an area where global players like Twitch were perceived to be weak in India.
Chapters:
- [01:29] From Wall Street to Digital Entertainment in India
- [06:59] The Birth of Pocket Aces: Pivoting from Bollywood Dreams
- [18:03] Cracking Viral Content: FilterCopy, Dice Media & "Solving Boredom"
- [22:43] Funding Pocket Aces & The Frugal Startup Mentality
- [28:01] Loco's Origin: Acquiring Showtime & The Trivia App Craze
- [30:41] The Big Pivot: Why Loco Ventured into Game Streaming
- [47:13] Understanding India's Gaming Community & Twitch's Gap
- [56:21] Monetizing Gaming in India: Ads, Microtransactions & Future Vision
- [58:45] Raising $50M+ for Loco: Pitch, Execution & Global Ambitions
- [1:04:00] Anirudh's Advice to Founders & The Power of "Just Doing It"
Hashtags for YouTube: #AnirudhPandita #Loco #PocketAces #FounderThesis #IndianStartups #GamingIndia #EsportsIndia #DigitalContent #Entrepreneurship #StartupJourney #VentureCapital #MobileGaming #Streaming #TechIndia #MakeInIndia #StartupStory #InvestmentBanking #Wharton #ContentCreation #MediaTech
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Transcript
Introduction of Aniruddh Pandita
00:00:00
Speaker
Hey guys, this is Aniruddh Pandita on the podium and I'm the founder of Loco. Happy to be here.
Gaming Evolution in India
00:00:17
Speaker
For the generation of Indians growing up in the 80s and 90s, cricket was the primary game they played, and this explains the enduring popularity of the cricket events like IPL. The generation currently growing up is more interested in games like PUBG, and there lies the opportunity to build events and streaming platforms for gaming fans. In this episode of the Founder Thesis Podcast, your host Akshay Dutt is talking with Aniruddh Pandita.
00:00:42
Speaker
the founder of the gaming platform Loco and the content company Pocketasis.
From Bollywood to Loco
00:00:47
Speaker
Anirudh is a US-educated investment banker who came to India to build a business around Bollywood content. He ended up building Pocketasis, which makes viral video content for young India to be consumed on social media platforms.
00:01:00
Speaker
In the quest to not be reliant on social media platforms for distribution, they ended up creating Loco, which is India's leading live streaming platform for gamers and has raised more than $50 million till date. Listen on, and if you like such insightful conversations with disruptive startup founders, then do subscribe to the Founder Thesis Podcast on any audio streaming app.
Growing Up in Kashmir
00:01:29
Speaker
I'm actually from Kashmir. The definition of home has always changed over time because obviously the happenings that happened there. My parents both are Kashmiri. Your parents were Kashmiri Pandits. You were actually there when the forced migration happened. You saw that first.
00:01:46
Speaker
Yes, we were there during the exodals. I have seen it first time as a kid as well. And you see the madness of crowds, you've seen generosity of other people. So it was a very difficult beginning to my childhood but luckily my parents were very tenacious and I always wondered, I'm in my late 30s and my dad had to restart his life.
00:02:05
Speaker
He landed up in Delhi with nothing, like literally he had to start from school. Basically, and then he moved to Kuwait and my parents both continue to live there still and I grew up in the Middle East as well.
Education and Entrepreneurial Drive
00:02:18
Speaker
What did your dad do then? What profession did he choose? So my parents, my dad is a cancer specialist and my mum is an engineer who turned homemaker leader.
00:02:28
Speaker
So for your undergrad, you went to the US, right? That's correct. I actually got into the IITs as well. And then I got into the US in an engineering school called the University of Illinois at Urbana-Champaign, which is a top engineering school. And even though I got into the IITs as well, if you look at the alum list, it's people like Mark Andreessen, founders of PayPal, founders of YouTube. And of course, that's where I met my co-founder Ashwin. So it's all the memories of that time and the experience we had. It was an amazing time.
00:02:58
Speaker
Tell me about your corporate world journey till you finally became a founder. Look, I went to college with some degree or ambition of starting something. I didn't know how to do it at all. We have no entrepreneurs in our family. No one before me. And so to me, how do you start a business was completely unfathomable. It was something we had never done. So we didn't have what I call dinner table knowledge about it.
00:03:25
Speaker
So I said, okay, let me do the next best thing and try and at least understand how businesses are built. And along with my engineering degree, I got a minor in technology and management was pretty nice program where they take certain number of people from business, certain number of people from the engineering school, and they put them together. And it's a terrible deal for the business guys, I think, because the engineer has learned a far more, I think the learning because I can't be too much about coding just in one class, but it's still better than nothing there. Those guys are much better off than their counterparts because they learn about
00:03:54
Speaker
a new world. And I did a bunch of business bank competitions, those sort of things, even one of few. And I didn't know what to do with it because I was like, oh, I won, but what do I do for that? I mean, this is a time before Y Combinator and all these things. So I think having those things today, I think, you know, I really appreciate that
Investment Banking Career
00:04:08
Speaker
they exist. So I went to Wall Street. I said, okay, let me go figure out and stand banking and private equity and those sort of things.
00:04:14
Speaker
I was pretty amazed by that work in the sense that how do companies raise some raise billions of dollars, some raise $100 billion, some die, some get acquired, some continue to be long-lasting companies. And that was really my business education, to be honest.
00:04:29
Speaker
I went into banking in 2006, which was, I call my look back at it as the jazz age of investment banking. We had huge mega deals going on, lots of leverage buyouts, lots of M&A action. I did a number of deals in my first year. In fact, I did. You were in the transaction side.
00:04:46
Speaker
Yeah, I was basically working in the healthcare division at Bank of America and did a lot of M&A work. I did capital raising also, it was an industry coverage group, but there was a lot of eFlow, frankly. So I think I learned a lot in that first couple of years. That's also when the recession happened, right? The first grains of the recession happened, which is what to see the excesses first, and then you got to see the signs of what happens when things are not going so well. And I moved to London by then, I was in real estate, so I was really in the middle of seeing a lot of this stuff play out.
00:05:15
Speaker
It was a really interesting education. And then I came to the Middle East. I worked at the sovereign wealth fund in private equity in Dubai. And I also worked at Goldman. Again, it was a well-rounded education. I would say it really gave me my, I always joke it gave me my undergraduate education and business. And I'll always be thankful for it. And unlike a lot of other people who dislike their time in banking, I really liked it. So yeah, that was my kind of journey in banking. And then you did the masters after Goldman.
00:05:42
Speaker
Yeah, I got into business school. And frankly, at that time, I really didn't want to go. I thought, what am I going to do? Waste two years. When you're young and I was a pretty patient guy, I was still much more impatient than I am today. So I was like, oh, no, two years. What will I do? I need my peers. Where will they go? And what will I do? I had so many plans for my own career. And now you realize at the end, you're in a race with yourself. So it doesn't matter. But I think good thing is after going to business school,
Transition to Digital Content
00:06:05
Speaker
at the time I had to think, I think you never get that time back. So I think from that point of view,
00:06:09
Speaker
It was a very valuable experience and the value of the network has only improved over time. One of the slides I show in my induction deck at NOCO and before that at POCADIS is a deck which has all the logos of companies which we take for granted today and products we take for granted today that didn't really exist when I graduated from college. Pretty much all of them didn't exist.
00:06:31
Speaker
Even the iPhone, I think, just came right after, right? I graduated old sixth and Apple iPhone came out old seventh. And I remember in my final semester, I was done with my exams in America, the books are expensive. So you sell them often. Otherwise, when I was growing up, those last few months, you'd never sell your books. So I sold my books and I was like, I got like some money here. And what does an engineering student do, right? We don't have so much interest in fashion and watches and all those things. So I went and bought an iPod and I still have that iPod. And it was amazing. You felt like a king with that product.
00:06:59
Speaker
How did Pocketsys happen? Pocketsys was essentially a brainchild of Ashur and Mayim. We were sitting in his living room. He had some experience of building films and film projects from ground up. I'm using the word project a bit here because people often think of films as a magical thing or products as magical things that just happen. If you use the word project, people don't like it. I actually like doing the opposite. He had worked on some interesting projects and he had access to some.
00:07:28
Speaker
Like Bollywood? Yeah, full-fledged movies like Talwar and those sort of movies that Times has set up. He had that experience and he had encouraged me when I was in... I had fun in the US after graduating to come and check out the media landscape. So, I came to India. I hung around. We worked with random producers. Some of them have become very famous now. Very talented people as well.
00:07:49
Speaker
And I understood that the media landscape is pretty bad and needs help. Were you looking at it from an investment banking angle in terms of funding projects? What was the lens with which you were looking? Yeah, the lens was how could we win here. That, to be honest, is the simplest lens. I always look at everything like how do I add value?
00:08:07
Speaker
If I had value, I will win, right? I don't actually have to beat anyone. Like I said, very early in life, I realized you, the best way to beat someone is to play them in a game they don't know. So, you don't have to do anything different, you don't have to run their race. So, we very early realized our competitor advantage, even in making movies, would have to lie somewhere else.
00:08:24
Speaker
And that thesis was flawed, to be honest. And I started to start a company. I always say, you have to fool yourself. It's not a rational choice. You can't look at the numbers and say, OK, 0.001% into $10 billion. So that's my expected value. And therefore, I should do it. It just cannot. It's not a rational decision. Most companies die. I think the other thing I would say is the default state of your business is usually dead. Most businesses will die. Now, the question is, are they going to die in five years, 10 years, five months, 100 years?
00:08:53
Speaker
That depends on your moat and those things. We then get into the Buffett porter zone of the world. But for me, the simplest thing was starting a business was what do we do better or different day zero and then the hundred three, three hundred have some, at least some markers of the long run, but in the short run, what could we do?
00:09:10
Speaker
And we already had a project pretty well cooked when we started. So there was some momentum to go with it. But then we quickly realized our thesis of our bigger thesis was look India doesn't have any enough number of screens per capita. Per capita screens should increase. Ticket prices should also increase. This is I'm just telling you our naive thesis. And we also felt that essentially Indian movies box office was too small.
00:09:32
Speaker
So for the cultural impact we've had on the world, if you travel anywhere, they'll know Shahrukh Khan or they'll know even as far back as Raj Kapoor, they'll know some taxi drivers. I was, I was in San Francisco in the Valley in 2018 and cab driver said, Oh, hear the song. I really liked the song. It was a Raj Kapoor song and I asked him.
00:09:50
Speaker
I already know the song. He said, oh, I grew up on this guy and I love his movies. And we felt that, look, if that's the case, we should have a bigger impact than $2 billion box office. And we felt a lot of Indian movies were looking inwards. And that's why it's not Salman Khan or Shahrukh Khan. There's not intelligent enough to know what they're making. What ends up happening is that they're making for the 1,500, what used to be 1,500 now, because we're doing 5,000, 10,000 screen type zone. But I think at that time, Salman and Shahrukh were doing
00:10:19
Speaker
three thousand five thousand screen type movies. If you have to reach so many screens you're going to have and you're going only focused on India, you're going to end up making what they ended up making. Just lowest common denominator will be happy. Whereas we felt let's just concentrate on the five hundred thousand urban centers, try to make our money back there and then sell in the movie abroad.
00:10:40
Speaker
Cause it's all dreams that we had. And we got very close. Did you actually produce a movie? So funny enough, we got pretty close. We got pretty close. We've never ended up making that movie. And that movie is not gotten made yet. I hear it may get made in the next year, but I also hear that every year. Like you had rights to produce on a script or something like that.
00:10:55
Speaker
Yes, correct. Actually, the people we worked with at that time have had a very significant impact on cinema in India. For example, we worked with a studio called whynot there from the south. They've made some of the biggest hits that have come out recently and very content heavy. And there was a meeting of the minds. There were two people, the promoter there, Sashi and Ashwal and I used to sit together.
00:11:15
Speaker
There is just a very strong and common understanding of what cinema should be, and how we can make money and not dilute completely the content aspect of it. So, I think they've done well. Matchbox, who we worked with at that time. Sheera Raghwan's made a hit after recently using Andhadun and Badlabur. So, I think we worked with good people at that time as well as we met good people.
00:11:38
Speaker
So just our film was, we understood why it's difficult to make a film, right? It's the anti-startup because you have high fixed cost, you have very slow moving organization because what ends up happening is we didn't want to make a movie with no commercials, right? And we were the right start cost.
00:11:53
Speaker
close but realize it's gonna take us two to three years and we will not be able to make sufficient progress and that's just too slow. It was too slow for our DNA and so we already raised some angel money by then and we told our angel investor look we're gonna completely change our business soon so you can even have your money back however you want to do it and he said don't worry you guys use it as you guys see fit and just use it well and use it in an honest manner and he said after that everything else is up to God so
00:12:19
Speaker
We thought that was pretty nice of him and we always stay grateful for these sort of people who show belief in times that are pre-testing. And so Ashwara then sat back and said, what's changed in the world? We looked at the biggest thing was essentially that we're talking about 2015 here. And what we felt was that
00:12:36
Speaker
It was the first time that India as a country was moving from a shared screen experience towards the phone becoming the centrepiece of the entertainment experience. So, going from a shared screen experience to a personalised individual experience of entertainment. And we felt everybody around us ride from when you enter a building in short security guard to sitting in an elevator, people, co-workers or whoever were on their phone.
00:13:00
Speaker
that first generation of people who started consuming content on the phone starter app. And so we felt that's the future. And we also had a pretty important streaming platform. We didn't know what the answer was. We just knew there was a problem. There's this content, the way people were going to consume content was not going to be the way
00:13:20
Speaker
We had seen it so far. So actually the answer in our mind was more like a TikTok rather than like something short Instagram like Snapchat type of thing. So we were like, this is going to change how things get done. And so we also went to Cannes to the film festival there and to one of the MIV conferences there. And when we were there at Cannes at the MIV festival, we saw all sorts of orders happening in the rest of the world. And I think that.
00:13:44
Speaker
impact to us as well because we were able to see the size of the market that you know in the size of the change it was not a small change and there were people like Netflix was announcing 20 originals and HBO was saying I'm doing so many originals why he's so saying I'm doing this you know saying this so these are all names that we were like oh like these guys didn't know three of these guys didn't exist until four years back they're making 20 originals like that's significant and we were thinking of making one movie before that
00:14:09
Speaker
Literally, by that time anyway, we were right on that cliff of jumping off. And that's when we jumped off and we came back, we stopped all the movie stuff. We completely said, we're going to do everything on digital. And that's when the journey started. And that's how Pocketase is in its current avatar. It was born and our mission became at Pocketase is about solving boredom because that's how we saw us playing a role. Like we wanted to be on every platform, try to
Content Distribution Strategy
00:14:33
Speaker
figure out how to pipe content there because we didn't see anyone else around us doing it.
00:14:37
Speaker
What was the product idea that you had? Was it so TikTok is like user generated content. So was that your idea or did you want to license content and then have people subscribe like a streaming platform or like what was it that you thought you would actually at that time it was not any of those at that time we were just thinking half that's why I said it was more a problem statement.
00:14:56
Speaker
So problem statement was like, how is entertainment going to change now that everybody's going to be on their phone all the time. And this is, I'm talking about 2014 and 2015. We really thought about this pretty hard. And that's when we started saying, look, people are just on the social platforms, the social platforms are where they're discovering want.
00:15:13
Speaker
And so if you have to be an adventure content brand, if you have to solve more than one different platform, you have to be on these platforms and learn how they work. And then along that journey is when we started thinking about, okay, we actually counted do it every day at that time, but on Facebook, which other people was based on YouTube, for example, right? So for example, you look at TV for AIB, they were more, and those were the vintage of our start rate. So those guys were all YouTube guys.
00:15:37
Speaker
And we were, firstly, we were nobody. And we said, look, YouTube's got its favorites. Facebook's got nobody. Others don't have anyone. So that's how we got started. And why I was talking about kind of TikTok is because during that journey, there were two or three periods at which we thought that we should productise a bit more. And I think if we had the engineering team we have today at Looko, I think 100% we may have come up with a more productised version of it versus a more content-heavy version of a business.
00:16:03
Speaker
We quickly understood the power of WhatsApp. We had one of the largest WhatsApp groups in India at that time. A bunch of them were continuously talking to us. We understood very early that WhatsApp is a great distribution channel. We also understood the power of short-form content. We weaponized memes. On filter copy, the meme explosion that happened, we participated.
00:16:25
Speaker
actively contributed to memes becoming a popular communication format amongst young people and I proudly say in that time people used to laugh at me that I love memes. This is like one of my favorite ways to communicate or even relax is to watch those sort of things and I'm not very good at producing them myself so I had to always get good people good things I can see and see it's funny or not so I was always had an audience lens and so I think from a from a business idea point of view we started with a very simple idea that there is no content
00:16:52
Speaker
creator who is piping content over these social networks we can become that person and it has to be original content if you want to do it quickly because otherwise it's too slow and if we get into this aggregation of user game then you're competing with Facebook and then our viewers that your product has to be better or different than Facebook something has to be different which is
00:17:12
Speaker
which was actually a search we had over time. We were looking at different aspects. Even I was one of the early users of Music.ly and the penny dropped for me when I used it. I think it was late 2017. I could be wrong. And I remember making a music video with one of our first tech hires and after we made it, we both knew. We were like, wow. Like we just made something that looked like a bad 90s music video with no money. We just made it for free and we suck. We're a good people who know how to do this stuff and don't want to spend time.
00:17:42
Speaker
So that's why we knew and so then you obviously other thing should be great the musically of India and get such a big social distribution platform by that point that any app we started anything we did we could get the initial zero to one initial user base but we just felt that look if you don't have a big product or a content or a community advantage then there's no point and that's actually played out very well in local world
00:18:03
Speaker
Tell me the evolution, which channel did you launch first? And so this was essentially like you decided to win the studio, create content and distribute content across various social platforms and via the native advertisements there and also like brand collaborations. Was that the business model?
00:18:21
Speaker
we came up with that business model. To be honest, there was very little branded partner at that time. I remember the first video we did for a brand was after a long time after we had actually built great distribution. And we told them, look, this will 100% work. They said, okay, we don't know. So he said, okay, you take, give us a low fee on this one. No problem. But if it works on the next one, you can't give us a low fee because you're just going to end up getting three advertising and
00:18:44
Speaker
You know, people were skeptical at that time of what YouTube could do, what Instagram could do, and these things could do. And I remember doing our first video with an advertiser and it just completely exploded. It went like mega-viral. We, I think, got like 500,000 or something shares on it. And when something gets that sort of sharing, those guys' sales just went vertical. And that was the start of our brand new business. And of course we built it alongside then in long form. We built shorter than short form. We've done many formats of entertainment and
00:19:13
Speaker
Scaled our brand in content business at pocket races, which is now I think the largest brand in content business in the country. Are you asking me what we built first? Actually, we built DICE Media first. Yeah, evolution.
Brand Naming Challenges
00:19:25
Speaker
First pocket races arrived. That was the first name that we chose. And that was supposed to be our film studio type company.
00:19:31
Speaker
But then when we decided to go straight up to the audiences, go direct to audiences with direct to consumer content, there we felt people couldn't even pronounce pocket cases correctly. So they were like, pocket axes, pocket asses. And so we're like, shit, like we just, we made a mistake here.
00:19:47
Speaker
Every name after that if you see it from our stable has been very easy. It's a cliché to say used apple but we use apple as an example because easy to say and Ola was the other one that we used as a simple example of something that's well branded for India. Everybody can say Ola, doesn't matter what it actually means. So that's why we started with DICE and that was actually the first channel we lost. Again, we had great success on it. The first video that we launched went like super viral.
00:20:14
Speaker
What was it? Was it like human or what? Yeah, it was like political satire, which we never did again. But it went super viral. And we, it was so late, the video, actually, this was at speed, a lot of bands were happening in different states and all that. So after the first band happened, we thought of this video. So we made the video.
00:20:30
Speaker
and then this was our first ever video so we were not even well prepared would be like overstatement and how like we were just super under prepared there was no I remember seeing the first cut sit and I remember calling Ashwin when I was on the Western Express highway calling him saying you know the content really resonated I think that told us something that content resonates there's a reason people share but
00:20:52
Speaker
After that, we tried a few things and DICE didn't work. That went viral, that first we knew. That went viral, so we were like, okay, we are the kings, we know everything. All these guys, why are they giving so much credit to these other people? It's us now and this is very easy. But then what happened is that everything else after that stopped working and actually DICE had been originally thought about it. We thought we knew better. So it was, it came from a creator mindset. But at the same time, we launched filter copy as an experimental channel.
00:21:17
Speaker
saying this is where we will do our experiments. And that actually picked up hugely because we were doing so many experiments that something was working, something was not working, but quickly we could realize what's working was not working. And I think that's when we realized that that's the methodology with which we should build. Then of course that became the rocket ship and we quickly pivoted DICE to what we originally wanted to do with pocket bases, which was to do longer form content. So then the longer form content came on DICE. Then we added Gobble as a food network. And very quickly after that we added, we added Loco and Loco, of course we went to the store in a bit because I was
00:21:47
Speaker
platform. And then on the channel side, we are a nutshell, which is doing very well. It's an infotainment channel. It tries to not be, it's what we call the not news channel. It's not a news channel. It is essentially a channel which tells you why the world is the way it is. Too much infotainment is about breaking news and news. We are not about the news, we are about understanding the nutshell channel is about understanding why, how can the Elon Musk be on the rocket in the way it took off.
00:22:10
Speaker
simple things you may have wondered about, interesting things that make you go like, wow. Like for example, what happened in Sri Lanka? Everybody's been asking me. It has to be the number one question. Everyone's been asking me that. So it's in the news, but nobody's actually explained to us what the hell actually happened. So it's got a cool explainer video. So that also came next. We also tried an animated channel called Jambu, which had some limited success. And then post that social distribution division of popcadises. That's how it got started.
00:22:36
Speaker
So essentially nutshell would be something like what Vox Media is like news. It's similar to Vox. Yes. Okay. And first brand that you said was around 2017. So 15 to 17. How are you funding it then? Production boss, video editing, all of that. We were super lean. Yeah. The frugality with which we run the pokinesis venture is pretty, pretty outstanding. And I think about what we managed to do with very little, it's pretty amazing and commendable. And yeah, we didn't pay each other anything very little.
00:23:04
Speaker
I think the mission was so strong that we wanted to change the way content was done in India. We wanted to show that something better was possible, that we could do new forms of content. People were so bored of the same old television that there was something new possible. I think the lot of people aligned with that mentality.
00:23:24
Speaker
And today, people who charge growers for a day's of work were working with us for five, 10,000 rupees. And that's just how movements get started, frankly. It's the nature of change. And looking back, we were fortunate to meet those people, but we also had a lot of fire in our belly. And we had raised some angel capital as well, like I mentioned, so that helped. But we really took it very, very far.
00:23:46
Speaker
And then in 2016, we did our series A with Sequoia Lead and that had 3-4 participated, then it was its founders participated, so it was a good round. How much did you raise? I think we raised about $3 million. In today's world, that sounds very little, but we were super happy because we were like, this is it, this is what we needed to give us more fuel to grow and then we did.
00:24:07
Speaker
created a lot from that limited amount of capital and it also allowed us to validate the work that we had done before because the stats that the investors saw they were just blown away by the quality of what we had done and we were much more about executing than just doing PR and those sort of things.
00:24:23
Speaker
And of course, with the frugal culture didn't leave us, we still are like that. And Bokris is still around with those fundamentals. And that's why I think if you look at the sector, over time, all our competitors have fallen by the V site, except a couple. And we continue to be there and we continue to do well because we didn't abandon those principles of how we want to run the company. Yeah, competitors would have been like the viral fever and scoop open these kinds of companies. There were many at that time. There were a dime a dozen had come up with it.
00:24:49
Speaker
Yeah, there were many of them. We, I see all sorts of words were there. The scooboo, mopex were there, many of them were there. And all had something good, but I think the discipline really showed. I think we did more in things well, which people don't like. And that's why I used that word earlier also, the project, because people like glamorize everything. Most bidding comes from doing the same thing repeatedly and executing extremely well. Right. Strategy. The strategy is execution. The bowler should have bowled a yokel, execution that
00:25:16
Speaker
I think
00:25:31
Speaker
The significance depends on who is looking at it. But in our buy, it was very small. But of course, it was all profit, right? Because it has no cost associated with it. Because we associate most of our costs with stuff that makes revenue. That's the branded content. And we invested very early in ensuring that we have our own direct sales. And that then ensured that we have a huge sales force out there with selling content and getting the right results.
00:25:58
Speaker
And what is the reach today? How many hours of content do you produce every month? The reach was producing 78 billion people. It's a huge reach for a week. So the network is very large now and I haven't worked actively on the business for a while but I sit on the board and I don't talk to some of the people who join from time to time.
00:26:18
Speaker
So Ashwin is largely running that. So now actually Aditi is running it. She's the CEO of Bocceres and Ashwin and I started the company. Aditi joined us and she became our third co-founder and then post that. Once loco happened, we haven't chatted about loco yet.
00:26:34
Speaker
Essentially, as we built the social businesses, we added two more business units. And then a third one, pocket races in 2019 actually had four business units. So there was a social distribution business that we would talk about. Then our social distribution business came this, we were doing these long form shows and that's what we sold to Netflix. And we were among the first guys to work with Netflix in India. And that show Little Things obviously has become a huge hit. And this has been the longest running Netflix original. It started as a YouTube show that we did on
00:27:04
Speaker
DICE Media, right? So that practice, the OTD studio business has become pretty large now. And then the third business that came out of it was essentially cloud, which is an influencer and talent management business, where we have so many young people who come to us and they act in our videos, they write videos, they do interesting things.
00:27:22
Speaker
and they essentially didn't get representation. So we now represent them and we help them with their business affairs and we help them get cast to movies. So we are like their partner then throughout the whole journey. And so those are the three businesses that came with through the social distribution business and that unit is still together as Bocconices and then Loco which we built in 2018, 2019 and onwards. That now has been spun off into a separate company.
00:27:47
Speaker
So one last question on pocket cases before
Co-Founder Roles at Pocketasis
00:27:50
Speaker
we start local. Is pocket cases profitable now? Self-funded? What kind of revenue does it do? You don't disclose that, but it's in the 100 or 200 CRH range. Amazing. Amazing. Okay. So now tell me how the local journey started. How did that happen?
00:28:05
Speaker
When we were building POCADESIS and over time in POCADESIS, I started thinking a lot more about our distribution aspect of the business. Ashwin was thinking a lot more about the content itself. Another thing was thinking about the monetization. That's how our rules were split. That's one cut of how we thought about the business. And the other way we thought about it is that whatever the three e-growth priorities, the top three, one of us will take
00:28:27
Speaker
each thing right and there's some problems that got twenty seventeen twenty eighteen and the key growth priorities were one was that we have to build our studio business get good content out there and make sure that we execute better with Netflix etc that creates the basis for a longer term studio franchise so I shouldn't really work on that along with Aditi and then
00:28:44
Speaker
In this case, does Netflix own the IP or you own the IP for little things? We actually own the IP. Wow. Amazing. Okay. In the case of that little thing, but it's a deal to deal thing, right? It's not a rule. And that was the first thing was this build the studio business, which Ashwin and Aditi took up.
00:29:00
Speaker
Then there was revenue which was essentially how do we scale our brand recorded business and she was working on that. She was the OG revenue person and that's why when we had discussed amongst us who will actually lead the pocketed business, we thought about which function is going to be really the key metric for the business and it was always going to be revenue and content and so that's where she became the right candidate. And then from there, the last one was to build our own distribution platform and which was I took that on myself and then
00:29:29
Speaker
What we did is we thought about late 2017, we thought about what are the two formats or three formats of content which will become prevalent with the mobile phone. So 100% with your short form is going to be really interesting and then we thought interactive will be interesting and short form we felt is going to be a lot of competition from Facebook etc. and like I said I've already seen musically and I felt it was a really good product.
00:29:50
Speaker
So we thought, okay, let's do interactive. We may have more time there and it's completely wide space for us. And we were just working on our product and we heard these three guys from Bangalore who are also working on a similar product. So I went to Bangalore and met all the guys and they were working on a product called Showtime, which is a quiz, a live trivia competition. We quickly did a deal. We acquired the asset. We got those guys on board. Two out of three worked with us for a really long time too. One out of three.
00:30:17
Speaker
continues to work with us and with me very closely in particular and he's the CEO of the company.
Rise of Loco
00:30:23
Speaker
And that's how Loco started and we aligned especially with the product, the tech guys I sat with them and we aligned 100% on how we thought this could get paid, who should be doing it, etc. And we went straight into the institution and it exploded the product. This came with a lot of reality. And over time, then we built the product out. We added hyper-calico games as per the platform and stuff.
00:30:45
Speaker
And then in 2019, we saw that gaming itself was changing. So either we need to make sure that we either become a fantasy or a real money business, or we look at the big change that was happening in gaming, which is that gaming itself was transitioning away from HTML5 gaming as being the slow gaming category to becoming more about mobile arcade and battle royale games, which is happening as well. So that
00:31:11
Speaker
It was a big change we saw and 2019 was really the time when the Indian gaming ecosystem was cracked open by PUBG Mobile. 100 million plus MAUs, every person around you, crazy around it, about it. And you know, being at Pocketrease was a big advantage at that time because Pocketreases and Loco, these are very young companies, right? Like I was 34, 35 at the time, like I was the oldest guy there.
00:31:37
Speaker
So you get a score sense for what pop culture was by seeing these people because they were doing it way before it became a rage for the rest of the world. They are the early adopters sat in front of us. We saw Babjiva while really becoming a rage in the office. And that's when I thought that look, this could be the next big content format.
00:31:54
Speaker
had a huge advantage in all three parts. We knew how to do streaming because we had done that in local. We did an amazing job there. We had the tech jobs, therefore, in the product jobs. Second was, is there a community that can be built around it? We had built an outstanding community with what the job we had done with each of those content brands that we had built.
00:32:13
Speaker
and the last was essentially what kind of content would we put on there, what kind of content creators could we attract and again we knew if anyone in India understood content creators and their grammar it was us we have been those content creators we know what it means to fail in when your video fails we know what it means to succeed the stupidity you can do when you succeed the silliness that ensues when you don't succeed what should you do how should you talk to someone all of those things we knew
00:32:40
Speaker
and a lot of the people who we worked with had consumed our content so they had a respect that okay these guys are not when they tell me that i'm gonna get you a nike contract i can get you a nike contract it's not i'm not talking just as a founder trying to get something done so i think that those things played in our mind and we said look this content genre is too small existing players are just primarily udu even there was very small they're not
00:33:03
Speaker
focused on this problem. Let's make that a full
Adapting to the Pandemic
00:33:07
Speaker
-blown effort. At the end of 2019, we really started pivoting the platform and changing it completely into what you see today. Of course, we ran head-on into the lockdown. The whole product has been basically built on lockdown. We've never had an office. The latest form of local has never had an office, which is insane. I've not met many of the people that were in person.
00:33:27
Speaker
You know, I used to be worried about work from home and work from anywhere when I started because at POCALYSTUS, we have an amazing culture. There is an electricity in the office that if you can get there, you will see that electricity in it. You cannot help but be infected by it. So I was always worried that, okay, like how we're going to get things done in this kind of post-POCALYPTIC world.
00:33:46
Speaker
Actually, I've been pleasantly surprised. The productivity has been way up. And I think the commitment that we're seeing from people and the real alignment with the mission and the pause has been amazing. So you've released the whole product. Now it's been almost two years. It's been an amazing journey. And yeah, we ran into the lockdown and that really started helping us because obviously live streaming became and gaming both became center of the entertainment funnel for many people, especially the younger generation of the country.
00:34:13
Speaker
I want to kind of understand better what was the Showtime product which you branded as Loco originally, like before the pivot to gaming. It was the same, it was a quiz. But we didn't want to name it Showtime obviously because it would be a violation of Showtime's brand name or whatever.
00:34:28
Speaker
So we launched with a completely new name, we launched completely with a new thing. And it was the same concept. What was the user experience like? It was very simple. It was supposed to be, you come in two times a day, there will be a quiz. You will play the quiz. If you get all the answers right, you will win something. So it's as if you are watching Kaun Mannega, Kaurpati and
00:34:50
Speaker
you were playing yourself and if everyone won with you, then everybody would split the price. If one person won, they would take home the price and became a rage. There are people, so, you know, local symbol as you can see is the hippo and we came up with all of this in literally in a week, right? In two weeks and you know, I remember talking to the whole team saying, hey, who do we want? And they said Gaurav Kapoor and next day Ashwin and message Gaurav and me and Gaurav were sitting together and Ashwin was sitting together and the day after he's hosting local, no time became local and local became a
00:35:19
Speaker
such a sensation. People had this hippo was all over like there were people were drawing fan art around him people like tattooed the hippo on their arm and you'd be amazed by it like you would see people doctors playing it army guys playing it you could walk into a bar in Bangalore or Bombay and you could see at the 10 o'clock or whatever that people would be playing the game so it became a sensation there's no doubt about it I think you were the quickest app to a million B.I.U in India at that time so
00:35:47
Speaker
It was an interesting lesson in how velocity works in when you find that massive product market fit what happens. And it still remains an unbelievable feeling. I remember talking to our CTO at that time and saying, look, he asked me like how many users do you think I can get. I said, 100k DAO, that is doable. We were at 100k within a week. So no, it's like, it's quite insane.
00:36:11
Speaker
So I want to take a stab at trying to figure out what made it so viral. I guess one is because there were fixed time slots. So there was a four ball that if you don't play at 10 PM, when the competition is going, then you don't have second is real money. Like you have a chance to win actual money. If you.
00:36:27
Speaker
And so then third is there was anyway the KBC craze so that trivia by itself was a popular category. The video experience would have been completely clutter breaking. Nothing else like that probably existed. You had a celebrity like Gaurav and that also would have
00:36:43
Speaker
added. That wouldn't have been the primary factor but it would have definitely added. It was an unbelievable experience. I think there are very few products that you see often that give you a sense of the future. It gave you a sense of the future where you felt like, wow, this guy, I had only seen him on television. He's here literally in the palm of my hand. And I'm actually interacting with him in an interesting way, which actually live streaming does. Live streaming does that. The only difference here I would say would be at that time,
00:37:10
Speaker
the fact that you could actually win something and it didn't have to be money. Actually, our stats showed us anyone who won anything, like if they got answers right, they would actually stay through the whole game. So it was much more, what do I know this? It was that same thing that we should do when we watched KBC when we were younger. It was like, Hey, do I know this or not?
00:37:25
Speaker
And the good thing is that it was general enough just like ABC where you could watch it with your family. So people do all this. And what would happen is that it would be easier if you're playing with your family because if you got stuck on a question, you would go A, your mom would go B, your dad would go C. That way one of you would survive. So there was that. And then of course there was the.
00:37:42
Speaker
helpline that helped a lot, which is that if you shared the link and you got a new user for us, you would get an extra chance in the game, which again was pathbreaking at that time. So there was a lot of different elements that combined. And I think there were a lot of competition also actually at that time. A lot of people tried to do this and we were winning by a mile because I think we got everything right. We understood our technology worked day in, day out. And those were days I remember at each mark, 10,000, 100,000, we went all the way up to a million concurrence.
00:38:12
Speaker
Million concurrence is like IPL, right? And we didn't have obviously the balance sheet of Disney. We were just five guys in a room. So it was challenging, but we kept at it. We really thought hard every day of our user experience, how could we make it interesting? And I think that still remains for me a great education and finding very strong product market fit.
00:38:34
Speaker
and this was like pre-recorded like Gaurav would pre-record and it would play in those time slots so it was like no it was completely live it was completely live okay would he like announce names of winners and stuff like that too yeah yeah you would announce okay so that's how that kick happened for a you got that feeling yeah exactly once he took your name and we did a lot of things you
00:38:55
Speaker
call outs. I think Gaurav was very GK as we call them fondly. We chose GK because, and look Ashwin at this, till this point had significant experience in content, right? So we had an idea of who is good live and who's not live is not easy. And many people, some of your biggest talent in India from a hosting or an acting point of view is not comfortable doing live. So it really came down to who could actually do live and who's still relatable enough for the public where they don't feel like it's too far removed from reality.
00:39:25
Speaker
So I think that's where GK picking him was good and he did an amazing job and we had so many fun nights actually like it was we were always remember and GK and I are still good friends and we jagged all the time and it's it was a crazy experience there's no no other way to put it I remember the one of the first times we did the show and he literally just he was sitting standing in the studio in front of the camera and his green screen behind him and
00:39:48
Speaker
He just went, you guys, I'm wearing a Vandy on top. And then he's wearing shorts at the bottom. And he just let the audience know, right? And then sometimes, you know, you tell the guys, come in here and clap for these guys. So it was not an experience from a content point of view. We made the experience spontaneous and relatable. Like, we didn't make it that, oh, look at this magic that we're doing. It was like, there are people behind the camera. And so people got to know. And that's the thing, right? The fan fandom was so high.
00:40:13
Speaker
that people got to know other people, they would be like, oh, so-and-so is behind the camera, so-and-so is doing XYZ things. So they knew this was the production team. And so I think we got the technology part absolutely right. It was able to, we were able to scale with the demand, the tech was able to scale. It was obviously expensive, but we were able to solve it. And in the same way, you were able to do the content as well. And then on the community side also, we did the same thing. So I think it was the seed of things to come.
00:40:41
Speaker
What would people do beyond these two slots then if someone logged on to the... Nothing and that was actually the biggest learning for us right? That a lot of other times people thought the app was broken and that's an India specific problem. They came and clicked on stuff and nothing would happen and they were like... And the answer was no actually. It only works in those specific times. So then what do we do with the rest of them? So we build started building features around that time and I think... What did you build then? Like just tell me that product evolution. So we allowed you to play quizzes through the day for example. You could do that.
00:41:10
Speaker
Then we slowly added in... And what, like pre-recorded? Yeah, those were the old quizzes.
Expanding Loco's Features
00:41:15
Speaker
Like yesterday's quiz, you could play a game just for coins, like soft currency, and then essentially then added hyper casual games and game tournaments. That really increased the time spent significantly.
00:41:25
Speaker
What was this hyper-casual gift? Just describe it to me. Like, you know, your kind of brick breaker, bubble shooter, like symbol, life's throwback, like those kind of simple games that we actually acquired another studio that time, Tap Q, and the two of the three members, they still work with Loco and they're doing very well. And they had the games already ready and they had a basic platform. We got them integrated and got the public there. That increased the time spent significantly as well. That's not the problem.
00:41:52
Speaker
These were not hosted by a video. This was just a regular game. It was a regular game. It was kind of like what Netflix has put today. We were overhead on that account. It's exactly what Netflix has done. We were just ahead and I think the point is that at that time, it's interesting. That's what I'm saying that 2019, the world significantly changed in gaming because
00:42:13
Speaker
This was the year where we integrated 2018-2019 integrated this game. We saw the time spent go way up. And that's when we also saw that essentially gaming itself was changing. People were playing different kinds of games. And that's where we realized that these sort of casual, hyper-casual games would then become short-form experiences and not really what people would do where most of their time would be spent. And we've seen that now very clearly like PUBG Mobile, etc. is constantly dominating both download charts as well as revenue charts.
00:42:40
Speaker
So what next then in the product evolution? So you launched the hypercasual games for engagement throughout the day? Yeah, we launched the hypercasual game and then I think we solved the problem of that we had nothing to do during the day. Then the key question actually became what do we do as a monetization method or we either become a real money gaming app, which is then they go away from the engagement we were providing or do you become
00:43:04
Speaker
something different like a UGC streaming kind of app. Gaming emerges and that idea did not come to us directly. We were initially thinking very hard about real money gaming. It's just that when we sat back in 2019 and thought about which route to your take, we just saw there's such a big change in gaming that we have to capture it and we were the best positioned to deliver that value. And that's how we then we said, okay, look, we have the streaming already, we're just going to go ahead and start on what a creator does and make it a UGC platform. That was what we decided to end of 2019 and 2020. Look, as we know it today,
00:43:33
Speaker
And what is it that a creator can do? Like he can point the selfie camera towards himself and host a quiz, for example, like what Gaurav Kapoor is doing. So this is now like fully live, you know, game streaming. So this is someone can actually, from their phone, start weaving themselves up. So they could be playing PUBG Mobile. They would have a face cam and they can go live or they would have a setup.
00:43:56
Speaker
and they have a camera pointing at them and they can go live. We provide the rest of the infrastructure, we allow them to go live, allow them to host quizzes, they can host polls, they can do giveaways directly in their streams, stickers, et cetera. So we build a full live streaming application for them.
00:44:12
Speaker
And we focused a lot on the gaming community. We focused on A, on bringing the best streamers on our platform and B, working hard on building a deal of streamers who could then become the next generation of stars. And of course, the product there has evolved significantly from what we released in 2020. The 2020 early product was very simple. If you wanted to stream, you couldn't even stream because we didn't allow it.
00:44:34
Speaker
So we first chose, seeded a few streamers, started from that, then a chat was, we must have re-written chat many number of times to make it better and better, both in terms of kind of things you can do in chat and also how it's scaled a bit time, right? Because as we got bigger and better streamers on the platform, the chat velocity just went vertical. And so how do you build that?
00:44:56
Speaker
same way the the stream challenge right we today i think apart from youtube we are the biggest concurrency at the same time in terms of number of users that one stream has seen and so we had seen that already we had done this ipl style stream when we were doing one stream a day but what happens when you have thousand streams a day or 500 at the same time thousand at the same time how do you build that and then how do you with loco 1.0 as we call it the quiz product it was easy to
00:45:23
Speaker
or not easy, but at least there was a way we could judge how many people are going to come the next day because we knew how many came yesterday. Content was relatively similar. Now what happens is I don't know who's streaming. I don't personally know all the streamers. I know many of them personally as well, but I don't know what content. I don't have a view into the content plan, right? So they may be doing something else. So sometimes someone does something really crazy and this spikes. So we built that. Then even
00:45:47
Speaker
Simple things like Rewind. We didn't build it in 2020 because in 2020 we also saw the ban of PUBG Mobile and basically esports in India kind of declined. And so it was much more about chatting and working with streamers and having a direct interaction. It was much more about the interaction. 2021 when BGMI came back, the Battlegrounds IP came back, esports came back into vogue. Essentially, the product has evolved significantly.
00:46:14
Speaker
2020 was much more about interacting with streamers directly because PUBG Mobile was banned. So there was no real esports in the car.
00:46:22
Speaker
2021, esports came back when BGMI came back. And therefore, earlier when in the 2020 version of the world, the audience didn't really have a need of going back and rewinding because it was much more about the live back. In 2021, it was much more about, hey, I missed this action. Can I go back? And even someone like a Twitch didn't have rewind for a long time. I don't think they still have rewind everywhere. So none of our rivals still have even have rewind. So it's like,
00:46:47
Speaker
Building small things like this really helped and we really improved our performance in 2021 in terms of the video experience, scaling experience. So 2021 has been a scaling challenge for us and it's been a great year because we've seen amazing numbers in the platform. Anyone who follows a few number of streamers in the platform and talking about September 10 ends up spending an hour and 15 minutes, hour and 20 minutes on the platform.
00:47:13
Speaker
I want to understand the whole gamer streaming while he's playing kind of a market. So you knew that there are people who want to watch a gamer stream because of Twitch. Twitch had a lot of Indians who were... No, there's no Twitch in India and there is no Twitch in India in the sense that there's no community. See, we realized from basically I realized when gaming and I saw the game streams around me, people was trying to watch them and play this, that essentially once you have a playing population, then you're going to have a watching population.
00:47:40
Speaker
You cannot have a watching population without having any sort of playing population. It's very difficult. And what this does, the mobile game allows you to democratize sports in a way that has never been done before. Today you could be sitting in Pillai or Ranchi or Darjeeling or Bandra and you can all play games together. This was never possible before.
00:48:04
Speaker
And you could play with your favorite superstar, follow them today in the evening, play in a custom room with them. Not possible in real sport. And I felt that, okay, this community is small and will become massive. And YouTube to me is like now the top of the funnel, right? They have all kinds of things on YouTube. And every single thing actually on the YouTube trending timeline has become a platform, right? So whether it's music, whether it's education, of course with an Academy and Waiju and all those guys, whether it's movies with Netflix,
00:48:34
Speaker
all of those have become platforms and the only one which didn't have anything was gaming or fashion and like I said I'm not very aware of our fashions I did not have a sense for what good needs to be built there and there is probably a platform of sorts that probably can come up there on the entertainment side and
00:48:49
Speaker
gaming we felt 100% we could build it and then the question was why not Twitch and the answer actually is quite simple is that these things are not just built just because it exists doesn't mean they're gonna have a community community building takes time and we said look we are awesome at doing that and so we just that was what gave us the initial confidence and then within the first two three months I knew we were we could do it
00:49:09
Speaker
say out of every hundred people who play a game, how many would watch live stream of other people playing the game? Is this like a big number? Yeah. So this is a very interesting question that you ask. So I have a theory on this and it's a time axis on it, which is that right now my guess is about
00:49:28
Speaker
40% or so watch. That's pretty big. But what will happen over time is that more people will watch than play the game. And what I mean by that is that if you look at cricket, right, all of us play cricket or, you know, football growing up and then we start watching on TV, then we stop playing as much because we have other things to do, but we still love the game. So we continue watching it.
00:49:50
Speaker
As I'm watching it, I also get other people in my family or friends to start watching it. So they become, I'm like the early adopter or the core fan. And then around me, a community starts developing. So they will not watch every day. Like I might be watching every day, but that indigenous culture starts emerging. So for example, I'm a big Liverpool fan.
00:50:09
Speaker
My family members also know who plays for Liverpool. But they don't watch every game. But then my mom will ask me, did mom with Salah play well today? What happened today? So it becomes an entertainment format. And I think that's where we are with gaming. We are in the first stage where obviously the core guys are watching. But we're not far away from when the second phase will also get unlocked. And that's when I think you will see much more casual streaming and all of those starting to emerge. It's at an ugly stage right now. I would say it's not everybody's doing it.
00:50:35
Speaker
But I think the interesting thing that I'm seeing is that pop culture icons for young people, sporting icons for young people are streamers.
Impact of Mobile Gaming
00:50:43
Speaker
For example, my nephew recently called me and said, I want to be a streamer on locals. I was like, what do you mean? Yeah, I want to be like mortal.
00:50:52
Speaker
Right? And I was like, okay, okay, that's, you know, old horses. Then we had another friend, Travis, and reached out to Ashwin, my co-founder, saying, he won't, can you help him meet Scout? So, we're like, what? Then we asked, recently asked, I met someone at a dinner and I asked this person, I was like, young person, I said, so who is your favourite athlete? I was 100% expecting Hardik Pandeya or Rishapant. And their answer was Jonathan.
00:51:17
Speaker
All these people now either work with us or are well-wishers of the platform and that gave me a sense that pop culture is evolving and it's not only in urban areas. And I think that's the power of what loco is, is that because there's this great democratization that has happened because of the phone. You're seeing players coming from everywhere. So if a player is coming from everywhere, who can be registered short that communities will build around that, right? So we have on our platform, for example, Mavi, who's from Sangeer in Punjab, which now well-known thanks to the new CM.
00:51:44
Speaker
You know, people didn't know what is in group, but it's not obviously like a tier one now. On the other hand, you have Jonathan Rose from Bandra, as tier one as you get. So very different, but they both play in the top leagues. Ashwin was traveling recently in Kerala. Everybody was playing in a pretty remote quad of Kerala. We have streamers from Kerala, from the Northeast. It is truly Indian game, Indian phenomenon.
00:52:09
Speaker
And I've had people from Kashmir reach out to me saying, you know, the audience writes to me directly and they don't obviously write in the flowery language that you and I can speak to. It's not a B2B business. When a B2C business gets forgotten, it becomes a BC business.
00:52:33
Speaker
So, he just starts like reeling me, saying, I don't know what to do, I don't know what to do. And so, but a great thing is from that I learned very quickly what is someone really upset about because we have a rule internally that if a person reaches out to us directly on Instagram or on Discord or
00:52:51
Speaker
on telegram or whatever, one person is representing 10,000 people. That's how do you should think in your head that for every 10,000 who didn't say anything, this one guy said something. So that's the amazing thing also is that because the audience of those skews younger, they also have less inhibition. So they just are happy to let us have it. And that helps us in our product because then it helps us improve quickly.
00:53:09
Speaker
Discord is just a way for audience. Why use Discord? Why not build a Discord within Loco only? That's a very interesting question. Frankly, it's something we thought about in detail. We think that Discord right now serves a very different purpose than what Loco does. But over time, yes, we could have features like that show up on Loco, whether it's ability to create groups, ability to hang out with certain communities.
00:53:34
Speaker
Those are things we are looking at. So the core features and the core use cases of those, yes, those can certainly be built inside of local. There is no doubt about it. But I think what Discord has done is again, it didn't come out. It came organically. It didn't come out of great design thinking that today it's a great tool used by all the gamers.
00:53:54
Speaker
and communities. And so for us, I think the question is, you know, it's like saying, why don't I build WhatsApp again? I think the question is, can you build a DM, right? And it could, and you could like Instagram as a very active DM, for example. I think we have to just think in the context of how the user uses our app. And in that context, definitely there are use cases from Discord, which can be built inside local 100%.
00:54:15
Speaker
So Discord is for a game like you sit and say a PUBG or is it like for everybody on local road? Like how do you use Discord? Discord is just like Slack. It's like a communication tool, right? So it allows you to have within a certain channel, it allows you to have different sub channels and sub groups, et cetera.
00:54:33
Speaker
So you have a channel for each game or? It's essentially for old people like me, this is like MIRC, but with audio, right? Like it's an internet-related chat with audio. And the design is not very intuitive for older people. I think it's meant for gamers. It's very clearly that it also, yeah, this is very hangout, is very strong in Discord. And I think it's a fabulous product. And they've done a great job of leaning into that community and creating more value there. And why do you have a Telenove channel?
00:55:02
Speaker
Same thing, just all of these help us connect with community. Yeah, basically there are different people on these different channels and they help us. They participate with us in different ways. We use it as just different ways of keeping in touch with our community. The same way that we have an Instagram and gamers hang out on these backgrounds. So we also hang out on these backgrounds.
00:55:21
Speaker
And do you also have like event-based IPs, say like a tournament and stuff like that? Lots, lots. We are the biggest, biggest organizers in that sense, our biggest financiers of tournaments. We are backing the most number of tournaments today. We have a lot of organizers who organize for us and with our support, which we have created many of them. And there will be obviously degrees of quality and experience there, but there are lots of interesting events that we do. What's the play there? Like, how does that help you as a business?
00:55:49
Speaker
Very weird like star sports and these events are like IPL or Isha Cup if you want to take a cricket or the ATV tour. So this could be now in the ATV tour. You could have the Cincinnati 500, you could have a Grand Slam like Wimbledon or you have some other Indian Open. There's a bunch of live that D Trophy. So exactly. So these are just content pieces, but they're more depending on their prestige and who's playing, etc. They get different viewership on the block.
00:56:15
Speaker
Okay. Essentially these events generate content, which then gives you eyeballs. Definitely. What do you estimate by say 2025? How would the revenue be coming in? Would it be through monetizing eyeballs through ads while the streams are happening? Or would it be like a directly users paying streamers like that kind of a more transaction based or what do you, what's your feel?
00:56:38
Speaker
See, I think India is not a one revenue stream opportunity. So, I think you will see a combination and I think good thing that you're seeing is that the generation that's on our platform knows how to transact online, is comfortable transacting online and is very happy to buy virtual goods because they do it in games. UPI and they've grown up with Paytm and Moby Quick and these kind of
00:57:06
Speaker
payments etc around us. They've seen UPI now almost everybody uses so I think you have the ability to do micro transactions extremely well and so when you look at a world where in four five years is our GDP keeps improving and you have better and better income, what will happen is you will see transactions improving for sure. There's no question about it.
00:57:28
Speaker
And also what happens is when obviously when the audience becomes more desirable, which is what this audience usually is, they're obviously already all of them on a phone. And then most of them have interesting games. So they usually the, it's an upwardly mobile audience. And so they will obviously attract, if they're rich, they will obviously attract richer advertisers or like our CPM advertisers, they're more desirable audience. So good thing is that it's,
00:57:53
Speaker
got both mass. So you've got volume. So it's not just guys who got a IBM W. So where there were no volume, it's also not like, you know, there's only a specific demo that you are targeting. It's very widely cricket and cricket. You could see like every single advertiser wants that because they see their audience inside that they see that cohort inside that audience. What's your advice to young founders?
Advice for Founders
00:58:18
Speaker
My advice to all founders, young or old, is don't think, just do it. There is no value in overthinking something. There is no equation or logic that has to be satisfied for you to do something. The important thing is timing is the single biggest determinant of success in a startup, according to me. So it's important to get out there and start experiencing the market. Without that sitting in a room and just postulating, you will never know anything.
00:58:45
Speaker
You raised like a massive round just now for local. So what was the pitch to investors? What are you going to use this money for? So that was the last series. And I think as every entrepreneur who has raised money, the raise itself is just the start of the journey. And the larger the raise, the more responsibility you have. And as someone who's worked in the financial markets, I'm only too acutely aware that this money comes from
00:59:11
Speaker
pension funds and places that people depend on. So it's not free money, and it's money that we use a lot of with the due regard that it deserves. In terms of what the pitch to investors was, I think the execution track record that we've shown after seed round has helped tremendously. I think a lot of people were not believers, frankly, at the seed round stage. Even then, we ended up doing one of the largest seed rounds in India, but there were a lot of people who were not believers, which I would say
00:59:39
Speaker
There was a transition to the next round where the inbound was phenomenal. And then we had 3x, 4x, oversubscribed round. We had so much demand, which was unreal. Borrow that was obviously the markets as well. They were in a good shape. But our execution I think was great. And then I think
00:59:57
Speaker
When we talk about a world where India will have 100 million plus MAUs and just game streaming, I think people believe that now and they've seen, I think the lockdown, I think had a big effect, right? By the time 2021 came, that realization that everybody is going to be gaming has come to the fore. In fact, I joke about it now that when you, back in the day, when you actually got a cable connection, they gave you a box.
01:00:21
Speaker
There will soon be a world where your cable viewer, a great guy will be the same, which is almost there, right? The geo is doing both now. They will soon start giving you either some version of a console or some a joystick or something to start gaming because they understand that's
Future Vision for Loco
01:00:37
Speaker
an elevation in terms of their value proposition to the customer. And it is also gaming itself offers a great value proposition to the customer who is trying to entertain themselves in a more immersive way. They're not going to go backwards. I actually foresee a world where there is all sorts of bundling of this sort of platform with various telcos. Now the pitch was pretty simple. We are trying to build the home of Indian gaming. We are a social platform for the virtual world. And I think as I told you,
01:01:04
Speaker
There is no other place where people can share their game memories and where they can hang out in the same way that they cannot go. And I think that is a dream that now people are also seeing with us. And I think we're a good place to execute on that journey. The good news for India and as an Indian is that there are a lot of other geographies where people have reached out to us and said, hey, when is loco coming to our country?
01:01:27
Speaker
Surreal to see, right? It is surreal and it is exciting. Having said that, going abroad is always a step you have to tread carefully on because it's a path you have to tread carefully on because it's not, it looks, everything looks easy from the outside. Like you could take any market and you could feel like, yeah, I can crack it because there's so many people who are, you know, come. That's already a good sign, but obviously execution is a, is where
01:01:50
Speaker
the real value. So for example, where we have a clips feature which automatically generates highlights, which when you can put a fan content where you can create a fandom around the core content, right? So key moments, fun memes, et cetera, around gaming right now. What is, what does the discovery of that look like? For example, those are kind of problems we're thinking about because if you made something like Instagram, it's going to look like a bunch of cartoons.
01:02:12
Speaker
on the discovered feature, right? So you want to think about should it be more of an up-down swipe? What kind of quality of clips do we need? Like most gamers are not editors, so like how do you give them an editor which makes it easy for them to create content? That's what you have to be finding. So we think about features very strongly but
01:02:27
Speaker
Again, this is around the core streaming feature, which is obviously we were really strengthened over the last year. And then we have a few products coming out also, which also elevates the fan experience. So there is, there is plenty that is in terms of depth that is that we can do. And I think that's what people have seen. So this is essentially to help you go global and to build up.
01:02:47
Speaker
products and add-on features. Yeah, basically it's to essentially build out the product. It's to help create a content budget because we believe any platform needs to have the right combination of product, technology, content, and community. So it's to build all of those things, of course, to help us market more and acquire more users and then explore new markets.
01:03:08
Speaker
What is the content budget for? You are a platform of user-generated content, right? It's essentially a content platform natively. Yeah, we do provide minimum guarantees, et cetera, for top-tier creators, which often ends up being a way for us to attract a quality audience, both on the new streamer side as well as on the audience side, and then helps us create the liquidity. And that's what we were very differentiated in our approach. There were others who tried to build a long tail
01:03:37
Speaker
which I personally think is not the right approach for where the Indian market is currently. In the long-tail, we come from the head being strong and from having that attention where you can give that attention. If you don't have the attention over, you give that to... That's what we're using that, but also we sponsor tournaments. For example, we're the largest top funder and supporter of esports tournaments in India. And esports, like three-to-enter tournaments, which we broadcast from our platform. So we've also created many
01:04:06
Speaker
such companies and funded them, not equity funding, but funded them from a revenue point of view so that they can have businesses. So think of these as like small merchants and small entrepreneurs that can come up from small tier, two tier, three tier, four towns. And I think the great thing is they are taking this funding, creating new talent around themselves and elevating themselves to the top of the food chain. So it's a really vital part of our strategy to have that as well.
01:04:30
Speaker
And we will continue doing that in different categories. We did it in PGMI. We are going to do it in other games that release, hopefully this year or next year, whether it's a valid mobile or it looks like it's mobile. We'll do that. Even PC gaming, we will support it because what a lot of people don't realize is that in three, four years, PC gaming itself, India would be like 60 mil plus users, which is bigger than many other countries. So for us, it's a small category, but we are focused on diversifying and increasing the kind of categories that are there on the platform.
01:04:59
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 this 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 this 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.