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The investment banker who became an educator | Nikhil Barshikar @ Imarticus Learning
222 Plays3 months ago
After a career in U.S. investment banking, Nikhil returned to India to build Imarticus, offering offline-focused boot camps to upskill fresh graduates. Unlike many in the space, Nikhil views Imarticus as an education business rather than an edtech company, with a fundamental focus on delivering real learning outcomes. This approach has helped the company grow and reach an annual revenue of 300 crores with very little outside funding. In this episode, Nikhil talks about how he built a successful education business and discusses the future of offline learning in today’s digital world.
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Read more about Imarticus Learning:-
1.Success Stories: How Data Science and Data Analytics Courses Have Transformed Careers?
2.Winning Stroke: Interview With Nikhil Barshikar, MD, Imarticus Learning
3.MY STARTUP IDEA: Imarticus Learning founder on his Eureka moment
4.Bridging the industry-academia gap: Minimizing wrong career choices
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Transcript
Nikhil's Early Life and Move to the US
00:00:00
Speaker
Hi, I'm Nikhil Barshakur. I'm the CEO and founder of Amarticist Learning. It's great to be here. I want to kind of ah start the story from Lehman Brothers. You've you've lived through interesting times. ah I would love to hear that pre-entrepreneurial journey of yours. so You went to the US to study. What what whatwar led to that? Just maybe we can start from there.
00:00:25
Speaker
Yeah, actually, my parents, so I grew up in Puna, and i my parents decided to move to the US. So me and my sister, along with my parents, we moved to the US when I was in 10th grade. So it was actually a family migration, if you will. I think it was coupled with the fact that I don't think I was a very good student. So my parents thought that me being in India and then the college ecosystem wouldn't lead to a lot of good. So I think ah you know our education was on the top of their mind.
00:00:52
Speaker
and moving there to the U.S. was an important part of that decision. So I moved to the U.S. with my parents, if you will, and in my 10th grade. I joined high school in the U.S. actually. Were your parents into software or like what made the move happen? No, come doubt um my dad studied in the U.S. My ah parents were U.S. citizens, so they had met in the U.S. and their story is interesting. They came back. My dad wanted to my grandfather was in politics and my dad wanted to build a business in India. So he came back one more. okay And they he built a business here. And it did well for a while. And then it ran into all sorts of manufacturing and union troubles. And then for him, you know, it was always going back to the US. And this time, you know, two kids in and a whole family. and yeah He did a business there also? or What did he do there?
00:01:44
Speaker
Yeah, no, he actually joined ah the Modi group as as one of the board of directors and then he ran the ventures there if you will. But yeah, it was almost, ah you know, we had always, because, and I'm i'm a US citizen too, so we always stayed close to the US, family vacations, mother had a lot of family there. So going to the US was, always thought that would be an eventual, you know, like at least to study, but as a family, I don't think we thought about them to go back to the US to live there if you will.
00:02:13
Speaker
yeah Okay. Okay. And ah what was your aspiration?
Inspiration and Career Start in Finance
00:02:16
Speaker
Did you want to be an investment banker? Um, you know, it's interesting. Uh, uh, 11th 12 I spent to the US, um, and right off that. And you know how your sort of sometimes your, your callings come from weird things. My calling came from the movie Wall Street. yeah it Michael have Douglas. Like every other.
00:02:39
Speaker
Most cliche calling I can ever think about. good you know Rich enough to not waste time. I remember that line. um So I think that's what was my calling. Yeah. And I wanted to do investment banking. I thought my personality and my sort of, you know, what I wanted to do, et cetera, would fit quite nicely. So I studied finance right off the bat. A lot of people sort of had that you know first year, sort of, what what am I going to do? I never had that.
00:03:06
Speaker
I pretty much wanted to study finance. I knew it. And I walked into a school with sort of a entire sort of coursework for four years for finance. Okay. And you were placed from campus at Lehman. Yeah. So they used to have something called the concentrating analyst program. ah So I started off there particularly. And tell me what your your journey at Lehman, what was that experience like?
00:03:35
Speaker
So the interesting story at Lehman, the first day, my first day was September 11th, 2001. And I was involved with financial center three. I mean, my running joke is that my career could only go up from there. The building was out there. And I remember, I mean, after the horrific sort of, you know, experience of all that,
00:04:01
Speaker
ah I remember that there was no building, there was no Lehman if you will, for a period of
Lehman Brothers Experience and Transition to India
00:04:05
Speaker
time. And I literally came back home and my parents asked me if my job was going to remain. I said, I think we had more other things to worry about at that particular point of time. um So experience at Lehman other than the first day, um you know, I came back three months later, ah was was fantastic. I mean, I think I did a whole bunch of jobs with them over a period of, you know, eight I was with Lehman literally 10 years.
00:04:30
Speaker
um and mostly in New York, some in London, some in Hong Kong. I did everything from a sales and trading job. I did some IB. I did some project management. I was part of the strategic office. So I think I literally had eight jobs within the 10 year horizon, if you will. And the other thing I did i mean I think a combination of of a lot of things. I did extremely well there. So I got promoted. I got paid a lot of decent amount of money and it was a fairly global experience, et cetera. So all in all, i mean I learned a lot there. Some good, some bad. Could you see it coming, the crash and what eventually happened?
00:05:11
Speaker
We saw it coming, we didn't want to believe it. We thought we were truly too big to fill. I think that movie was spot on. We really thought that we were demon. It's like, I mean, we're just too big and too important. I think that arrogance that, you know, to, interestingly to succeed in the rest of mankind, you need three things. One, you need the ability to take a risk. Second, the ability to be long term. And third, you need to be think you're a, you know, you're a kick ass.
00:05:40
Speaker
right Lehman had all three and that's why it succeeded for a while. But I think two of those three is what made them bankrupt also. Why the third? I think that, you are too succeed yeah the you know, that that type A personality that I know no and that confidence to say that I'm going to see it through a super important investment package.
00:06:03
Speaker
A lot of the deals didn't exist. We made up those rules. We went in and convinced promoters and convinced investors that this is a space. And by the way, when we came into a lot a lot of these sectors, we knew less than the promoters and the investors. So to have that confidence to think that, no, this 20-year-old promoter has been running that business, you're going to tell him how to run it.
00:06:23
Speaker
run that business for this investor who's an astute investor for the last 10 years in this sector. But you are going to come in as a bank and put this deal together. It requires a fine set amount of distortion of reality in my head. Okay, phenomenal. So what did you do once the crash happened?
00:06:48
Speaker
Interestingly, when the crash happened, I mean my family makes fun of me that I'm at these seminal moments for whatever reason. So I had landed up in India and the day Lehman went bankrupt, my luggage was being sent as an expatriate package here.
00:07:02
Speaker
So I actually had worked in the abroad and Lehman said, why don't you go to India and help us set up there. So literally I literally had landed in a week before and my luggage, you know, as a part happens in his expatriate package, you you throw in a lot of money and throw a lot of perks if you would. So my luggage had landed the day they went bankrupt and nobody refused to pick up, you know, my luggage, if you will. They're like, well, there's no Lehman, so we're not going to pay for anything. So don't worry about it. So I literally landed up in India. My credit card stopped working. The Lehman credit card. I used to stay up with the Renaissance in power in an apartment and more. So I remember that day and we had at that particular point of time and Lehman, Lehman, India was being set up and we had sent a lot of people abroad to be trained.
00:07:50
Speaker
And their credit cards stopped working, literally, one day on that day. And we literally had these hundred people out there and calling me saying that, look, we don't have the means to come back. Our return tickets have been cancelled. And I remember swiping, you know, at that particular point of time, it was $30,000 on my personal credit card to get these guys back. So I think those experiences on you know that day and and you know as time went by,
00:08:14
Speaker
Sort of teaches you a lot, right? And also almost you know humbles you, saying that look, this can happen to you and this is happening to you, so get real with it if you will. So you asked, ah did we see it coming? I think we should have seen it coming. The writing was on the wall, we just didn't want to see it.
00:08:35
Speaker
What did you do then? So you're in India without a salary. So interestingly, the salaries were, we still had a salary. Like we realized, I mean, we figured out their bank accounts, if you will. And, but then the ah the question was particularly that we have 2000 people on our payroll and there is nothing to do as such. There is no, you know, work. So we went about trying to find the next buyer for our business, if you will.
00:09:01
Speaker
So I literally, with my so current CEO, went around the world, talked to corporates, talked to and figured out what to do with this business because we had built a decent business out of India. ah So that that itself was ah was a great experience. right doing going Looking for a buyer, if you will, in ah in a market at that particular point of time was And it happened to us. they Finally, you know we got a few bids. And Nomura, which is based out of Japan, okay ua gave us, bought us out in in in Europe and in Asia. So it was a good result, frankly, for most of us. We got paid out these hand-cuffed bonuses for a while, which were also interesting to stay in the business for a few years. But from a result perspective, we ended up but you sort of landed up back on our feet, if you will.
00:09:53
Speaker
So the India operations would be something like say MCKC, the Mackenzie Knowledge Center, like an organization like that which Namura acquired. So Namora acquired both the front office business, which was ah pretty much a fixed income and investment banking business, and then acquired the shared services that you just mentioned. So we did both the deals, if you will, et cetera. But our exposure on the shared services was a lot bigger than the front office businesses. It was almost, I think it was at that particular point in time, 15, 200,000 people. So it was a lot of families dependent on that particular piece, et cetera.
00:10:31
Speaker
okay and So you were running that business for Nomura? What did you do? was ah I ran a part of that business for Naboora. I used to be based out of Hong Kong and then I decided to come to India to run most of it. ah So I was one of the first employees in Lehman here in India. Actually I was the first employee. And then Naboora ended up taking over that business for me.
00:10:56
Speaker
okay and like Why didn't you continue in the investment banking space? What led to your marticus?
Founding Emarticus Learning and Initial Growth
00:11:06
Speaker
I mentioned earlier that you need three things to be successful in investment banking. Risk taking ability to think long term and then to have that distortion of reality if you are the smartest person in the room. The Japanese don't have to ah or do those three.
00:11:23
Speaker
You have one, which is the ability to get out of it. So to me, I think working for a number 47 bank, when you worked for Lehman earlier, there's a massive culture shift. There's a massive ability to take risk, the ability to think through deals that seem more vicious or seem impossible to do, if you will.
00:11:46
Speaker
So I think that we realized very quickly because, and rightly so, Namura had done well in the Japanese market. They were fixed in compliance. Their investment banking business was at best. i'm Taking over Lehman at cheap was a great move for them. But as professionals, I think our aspirations were different. My aspiration was different.
00:12:07
Speaker
And like I said, working for a Japanese bank, a Muslim bank if you will, etc. The other piece I think, and I almost think about this sometimes, if that hadn't happened, would I have stuck to it for a second? And I think there the answer is no. I think I was done. I had done well in a small amount of period of time.
00:12:26
Speaker
I was, they wouldn't give me a top job till I had a lot more gray hair, if you will. So I think that I was ready for the next step. I think this, this thing just pushed me over and said, now really think about it. So yeah. And how did Emarticus happen?
00:12:46
Speaker
So actually should buy well you know by chance, ah we thought about, my sister was at that particular point of time in in Singapore. She had just graduated from NCI and she was working for Accenture. um We used to think about you know coming back home. It was like my dad on repeat, if you will. that might be This might be the right time to come back home or come back and do something in India. India is booming and so on and so forth. So we used to throw around ideas on a regular basis. And me and my sister always worked well together. We had never actually worked professionally, but seemed like you know that we could we could do something together. We threw out a few ideas. We looked at hospitality as a sector. We looked at education as a sector. We did a bunch of research. We came to education for two big reasons as a sector that we wanted to spend some time. One was impact. I think that was you know we both wanted to do something that was impactful to the end consumer.
00:13:38
Speaker
At second, we thought education in India was very nascent. It was just the formal education that was that was being done. The informal education, and this is 2011, if you will, was still not being done properly, not at scale, if you will. So I think very quickly, it didn't take us too long to come to education as a sector. The business model after education took some time. Then we came and we came on we both came back to India. I was in India. She came back.
00:14:02
Speaker
We spent some time visiting universities, visiting schools. at At one particular point in time, we wanted to open up K-12 schools. And then we said, maybe universities make sense. I remember going and visiting about 26 universities. We wanted to buy a university. ah So then the vocational education of it, making it a little bit more asset-like, more scared, ideas like that started to come through. And that's how you know the idea of a modernism work.
00:14:30
Speaker
so What was the first product you launched or or the first course? We still have that course. It's actually one of our biggest courses. So the first course was very related to the shared service function that we ran at Lehman. So it came from deep insight. It came from an insight where we knew that this talent or this knowledge was not being given to people.
00:14:56
Speaker
and That insight was actually quite valuable. And we created an investment banking operations course, which was driven around captive organizations in India for whether the JP Morgan's in the world or Goldman's in the world or Murat's in the world. So the first product was a train in place that we would train people for a short amount of time, make them employable for these captive organizations, if you will. That's how we thought about the first product. And again, it came from a lot of experience.
00:15:29
Speaker
So I remember spending a lot of time on the curriculum myself. I knew the domain. I knew what the banks were looking for, because frankly, I'd hired a lot of these type of roles in my earlier organization. Also, the other thing that helped out when we started off the business is I came in with three, four of my colleagues who had worked for me at Lehman & Nomura. So I think that leadership, if you will, we were quite top-heavy quite quickly.
00:15:57
Speaker
you know So that was another sort of you know how we built the business, how how it came about. Did it make sense to be so top heavy? Was it an asset or a liability to be top heavy so quickly? I think it was an asset. For the simple reason is that, you know,
00:16:21
Speaker
It's not that we didn't have larger aspirations, but you know, getting these guys and paying their salaries out of my own salary and sort of helps you, you know, realign to be a little bit more scale heavy also. So very quickly, for example, that top heavy, we but we built out more centers. we We went in more locations if you will. And I think the one thing we'll talk about it later more, I'm sure is that my entrepreneurial journey, you know, has not been a lot of hardships, you know,
00:16:49
Speaker
You know, a lot of entrepreneurs talk a little bit about, you know, they went through a lot of hard work, but not a lot of hardship. Not a lot of angst, actually. And I think that's because we built it out with a certain set of responsible senior leaders who I had worked with a lot. So they sort of, you know, took the burden or took the angst away, if you will. But having said that, when I write my story, there's going to be a lot of hardship. At least outside of it.
00:17:19
Speaker
Okay. ah You started with like you rented a place, created a classroom there, advertised in a newspaper. I guess at that time it must have been a newspaper ad or something like that. And like that that was how the first cohort got launched. Yeah. but I mean, you're you bang or right We went and looked for places in Andheri in Bombay, found a defunct business group.
00:17:50
Speaker
um yeah My parents didn't want me to take that particular place because it was defunct, bad karma, all sorts of stuff. you know So of we went through that whole process, et cetera, but it was in full already, beautiful infrastructure, three to four classrooms, you know four, 5,000 square footer.
00:18:10
Speaker
Again, you know the ah question that was being asked was, that do you need such a big space? Can you do it with a small space? You already hired these expensive people and you want to buy these expensive real estate. ah So I think that those are the questions we were answering for ourselves.
00:18:26
Speaker
So we did that, you know, first, I remember first sort of marketing seminar. We did it in in Renaissance but by for which was exactly the wrong place to do it. We thought because they don't like to come to first house, they find it intimidating to come to a large, large hall to to talk to, you know, what we believe senior investment bankers.
00:18:55
Speaker
So I think we were completely away from a reality and the reality of what a consumer is looking for and how to approach him and what to say to him, et cetera. We looked at it as, you know, earlier. So I think mistakes like that. And I remember,
00:19:11
Speaker
again, I remember, you know, sort of hiring the Renaissance ballroom. We were expecting 350 people. We got 15 people. Oh, that's when we And I had flexed my muscles and called my earlier bosses. And you know people I knew, this was our first venture into it. So I had eight managing directors, 15 vice presidents. So it literally lined up if you want to talk to 350 people. And literally 15 people came. ah so yeah So it's interesting i mean you know what you think will be successful and what is, if you will.
00:19:51
Speaker
So I think this was supposed to be like people talking on a stage and 300 people sitting and listening kind of a thing, but okay. No, like a, you know, early career in finance, if you will, and lots of data people and literally, and we had with that whole paper ad and, uh, you know, in hindsight, it just seemed so stupid. But at that particular point in time, you know, we didn't know any better. We had not actually, though we had a lot of experience in IB, we had not run a D2C consumer brand.
00:20:20
Speaker
don't know how to so you We don't know what to say. So we've been learning. you know That was the fun part also. But I think we made a lot of mistakes like that. So how did you fill the seats for the first cohort then?
00:20:35
Speaker
So we um mean we literally counseled them. So we created walk-ins, if you will, to come to the center and make them so. So Stonja used to come in and you know individually talk to them and and tell them about investment banking, etc. Did a lot of counseling myself. I think the first two cohorts I filled myself, I still make fun of Sonia that I have a much better conversion rate when it comes to...
00:20:56
Speaker
think counseling that most of them so yeah I mean very hands-on right like we counsel them then we have some trainers though we were building for scale like we had in in year two we had already put up Bangalore and Chennai as two more units we were quite aggressive in terms of building out the units quickly And like and I mentioned earlier, that's why I think out of my four leadership team, one was sent to Bangalore, one was sent to Chennai to run those units, if you will, I think. And that's why we were able to get a little bit more faster scale than maybe our peers, because we had that sort of responsible leadership, if you will. What kind of revenue did you see per cent? And like what was like the peak revenue per cent that you would see after maybe it stabilizes in a new market?
00:21:45
Speaker
So you know one thing that we were very clear on in terms of the business model is that we did not want to do the high 100 cities, 300 centers type of play. And for the simple reason is that we think that a significant amount of investment Not in terms of building output, in terms of running the centre and making sure that the training is at a certain experience. It requires a certain amount of bandwidth governance and we didn't think we could deliver it at 300 centres. So our my my belief in the business model was that a centre should be meaningful. what that Now it tends to be about 10 to 15 crores per centre. When it started out off, it used to be 2-3 crores, then the second year is about 5 crores.
00:22:32
Speaker
Now, about in three years, we're able to get it to 10 to 12 karos. And this is the size we like. So every center does about 10 to 15 karos in revenue, 20, 25% of it. And in our center, if you will, I want you to 3,000 to 4,000 square footers, 3,000 to 4,000 classrooms to your counseling areas.
Course Design and Offline Learning Emphasis
00:22:49
Speaker
if Very urban, very sort of not high fashion retail, but at the same time, sort of very accessible retail space, if you will.
00:22:59
Speaker
and like What is the you know where's the price point? Is it a full-time course or is it part-time? Help me understand the product a little more. Yeah. So no, one of the things we were quite keen from a product perspective is make sure that the product has good ah ROI. And we almost built it as an MBA replacement. So our view was that to this product, instead of an MBA, it was shorter, cheaper, and has better outcomes. So that's articulation of the product.
00:23:31
Speaker
So what it looks like, it's got four to six months of fairly intensive training. Take full time. Full time. We have part time versions which go six to eight months, but most of the people do it full time. It's fairly intensive. And if any criticism of the course, the criticism tends to be that we are detail oriented on that subject. So the guy can't speak to maybe you know the future of or the economics of it of it, but can talk to how to how to settle a credit default. So very specific to what the job requires. And it's done in a short period of time. It costs a fraction of an MBA with decent placement rates and high placement rates. So that was the sell, if you will, from a product perspective. And that's what how we designed the product in terms of even the outcome. Okay. So it's it's like a bootcamp for investment banking jobs.
00:24:25
Speaker
Exactly that. So that's what we started off with. We started for bootcamp as Mac and we added more legs to finance over a period of time than we built out an analog entire analytics version, if you will, etc. That's about it.
00:24:39
Speaker
and like what is the Why didn't you do like an online, most bootcamps which started, ah eventually pivoted to being online. But from what I can make out so far, you're still very focused on offline centers. What is the reason for that?
00:25:03
Speaker
So, when we started off offline, and frankly, there, there was no logic, if you will, which is we believe that the offline, you know, the touch points were important. And we went in with that belief that the Dutch points were important.
00:25:17
Speaker
And you know it takes about eight to 10 different Dutch points to make someone employable, if you will, are in our mindset. um Covid is when it we truly tested that premise, I think, because we had to go off online a few. There was no choice.
00:25:34
Speaker
And COVID sort of proved to us that our premise of ah the the offline touch points were important. So the simple reason is because we moved our training online and our placement ratios started dipping, if you will. Our conversion ratio is when people went to jobs and started dipping. So it sort of reinforced our fact that the offline business or the offline does provide better outcomes for at least for employment. So that's what sort of we stayed on with them. Okay. we so said here okay yeah we we stayed with that idea and then
00:26:05
Speaker
and sort of almost double down after Okay. Okay. You said eight to 10 touch points are important. What do you mean by that? Like.
00:26:16
Speaker
So after the training is done, there's a significant amount of work that happens in the basement or is getting someone ready for a job interview, if you will. And those are the touch points of what we've got. How do you do a mock interview? How do you write your resume? How do you present your resume? So we do about three to four different mocks from different people, from industries, if you will, to get the person, you know,
00:26:36
Speaker
You know, because remember these are normally from tier two, tier three colleges. A lot of this has not been done in their colleges. Their ability to present or tell their story is weak. So I think those are the kind of things that we we found out very quickly that those Dutch coins are important. Okay. Okay. And what is the average course price so or maybe the range?
00:27:02
Speaker
The average cost price is about 1.5 lakhs. It ranges from anywhere from 1.3 to 2.5 lakhs, if you will. That's the average point. And the way we think about this is that the jobs that we offer are anywhere from 4 to 6 lakhs, if you will. So technically, it should be 2.5 times fewer than the job that we get here, which frankly is better ah ROI than my expensive MBA.
00:27:27
Speaker
True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. True. So let me tell you a little bit more about the business because I think what we True. True. did is True. True. True. True. True. True. True. why we started off True. True. True. True. True. True. True. True. True. with the bootcamp business. Over a period of time we added an executive business. So early on True. True. True. True. True. True. True. True. we started the True. True. True. True. True. business and True. the entire audience was freshers. People who were just looking to graduate, who had just graduated.
00:28:04
Speaker
over a period of time then we actually reached out and said look if you have chosen the domain of finance and analytics now let's go and build out a portfolio or a product portfolio for all of the entire sort of audience. Then we built out a executive portfolio and then we also built out a certification portfolio. So today what the business looks like is we have a bootcamp portfolio for people who are looking for jobs. We have an executive portfolio for people who have experience and are looking to upscale themselves. And then we have a certification portfolio, which is people who are looking to certify themselves with industry certificate.
Diversification and Acquisition Strategies
00:28:38
Speaker
It would be a CFA, CMA, and so on and so forth. So that's the D2C side of the business. Then we built ah we actually got dragged into the B2B part of the business. A lot of companies came to us and said, look, you seem to know what you're doing in terms of training. Why don't you help me train my employees?
00:28:52
Speaker
So then now we have a B2B business that we've built over the last four, five years, which is now significant. So I think today the business is a B2C, which is 80% of our revenue. And then a B2B business, which is a about 3% of our revenue. Last year we did about 400 cruise in terms of revenue and 12 to 13% of business. Well, okay. And this is all ah like largely offline. you you You don't sell like a pure online ah product.
00:29:21
Speaker
No, executive business is mostly online actually. Okay. The business that is, we partner with, you know, premier institutes like IGs and IMs. That's mainly a man sort of online first business. The bootcamp is an offline first business. I mean, right now after COVID frankly, a lot of blend is happening too, you know, the hybrid if you will, but you know, it's the bootcamp business is still an offline first business. Okay. Do you see yourself as an ed tech or an education business?
00:29:51
Speaker
Nowadays, it's really bad to see yourself still at edtech, so I definitely do.
00:29:58
Speaker
oh No, to be honest, me never you know to me, the definition of any any tech, or fintech, if you will, is it's tech first. But we have never been tech first. ah We've always been sort of outcome first or education first, if you will. So yeah, I see myself as a sort of a new age education player rather than a head tech The technology is important. I'm not saying it's not important, but it's truly enabling. Okay. And you've not gone down the franchising route? No. Our view is that to deliver outcomes, you have to keep training quality at a certain level and to keep training quality at certain. Frankly, it requires a certain amount of hard work and governance. And to get ah another person to do it is even harder.
00:30:52
Speaker
So we've stayed away from franchising. We do some sales franchising, but we'll train the franchising. We're very clear that we will not franchise in the future. i knew as result There is such a large addressable market for what you're providing.
00:31:12
Speaker
And you're probably just scratching the surface of that, right? In terms of like a imp employability oriented course, which gives you like a 2.5X of your investment back as your first salary.
00:31:31
Speaker
And you're going beyond investment banking into analytics. And I'm sure that that there are other allied domains also which you can continue to go into. um So i'm I'm just wondering, why not but why didn't you be more, ah why weren't you more aggressive? I mean, I asked this question as an entrepreneur. I think one of the things you always wonder is why aren't you bigger?
00:31:56
Speaker
oh One thing I realized particularly in the education business is that, you know, I mean, if you leave away the acquisition dollars that me and some of my peers have spent, if you would, the education business is a referral order of business, right? And to expect that business to do, you know, Mike Kago, if you would, my growth Kago over the period of 10 years has been, let's say, 30, 35% when I started the business from nothing.
00:32:24
Speaker
I think it requires a certain amount of patient capital and a certain amount of making sure that all your services, because at the end of it, to deliver a placement, you have to have the right ability to sell, train and place. And in some senses, you're almost your offerings have to come together to give you that final placement.
00:32:43
Speaker
And that, there is a certain amount of growth rate that you should keep yourself at. And I've learned this the hard way. It's the time we have spent, you know, saying that, look, this year we're going to go 100%. We've started to see some of this fall, either the training falls or we we get the wrong people in the course, or miss selling happens and so on and so forth, if you will.
00:33:02
Speaker
So I think one way is that the type of business that we are in and we have to be careful because this is truly impacting lives and impacting careers of people, et cetera, that growth, it can't be the only metric if you would. Outcomes has to be that metric. So I think that's one big piece that you have to grow it out slowly and surely. Now the word slowly is relative. My slope can be your fast and vice versa.
00:33:30
Speaker
um But what we could have done, I mean, if one of the things that I think we should have done a little bit more is turn global faster. To me, I think we stayed in India. Pre-COVID, we're doing a lot more experiments globally. I think COVID came and wiped us out, all of our global experiments. So I think one of the one of things that, you know, in hindsight, you always look at it, but I think one of the things that I would have done faster early on would have been launched more globally.
00:34:01
Speaker
Like an offline center in other countries? Yeah, whether it's offline or even it's ah executive business, it could have been done online, etc. Because I think within a certain market, you should keep a certain growth rate. Can you grow to 100% sure you can? Anybody can do anything in some sense.
00:34:24
Speaker
But I think it's difficult. You know, it's not exactly a SaaS product company where you make a product and then you go, go. And everything goes, you know, 300% and everybody's happy about it. I think it we are in the services business and and more to boot, we are actually in a sort of education business. So you've got to be careful about how you grow it up. At least that's what I myself can always sleep at night. so
00:34:49
Speaker
Okay. You, you have raised external capital, right? Very little. We raised about million ah over a period of 10 years. So we haven't raised a lot of money. Is there not a 5.5 million round last year that you did, which I can see on traction? No. In total, we have raised about 3 million. Okay. Okay. Okay. There must be a...
00:35:21
Speaker
inaccurate data. It's showing that you raised five and a half million from Hero and Global Ivy Ventures last year. Oh, okay. So it's an acquisition actually. We bought a company from the Hero Group. Maybe that's shown as a, shown as a fundraise rather than I. Okay. You bought the, Hero had a training business. Did you buy that? Yeah.
00:35:47
Speaker
you know't mind you know Hero mind mind. Okay. which Which is pure B2B training, right? Hero mind mind. So that was our first foray actually into other than finance and analytics. One of the things we have, while we are extremely sector focused on the B2C side, on the B2B side, ah we have let this thing, our obsession over finance and analytics and of domain gone.
00:36:14
Speaker
If you have a large client, then that client requires different services. He wants a leadership program. He wants a finance program. He wants a sales program. And we should be able to service all that. So I think that was our first that was the reason to sort of require that company and acquire that capability. Now we are able to give our clients, wish most of our clients are large clients, able to give a wide variety of services that we couldn't give them.
00:36:39
Speaker
Hiromain did everything, like it was a full-stack training, corporate training company. Yeah, but mostly in sales training and leadership training. There were a whole bunch of things. but the And the clients were not finance and artist firms, which is what is attractive, that more and more FMCG companies, auto companies, ah you know, sort of local insurance companies, if you will. So I think the client pool was interesting and also the product was interesting.
00:37:07
Speaker
Okay. Okay. Okay. And this was a cash acquisition or ah like a, uh, we did a part or so. Okay. We did a part. Okay. Okay. Okay. Okay. Okay. And and how is that thesis proved out? Like there was a thesis on which you made that bet. Uh,
00:37:26
Speaker
ah Extremely well actually, so when we the business has grown about 40%, it's a lot more profitable. we've We closed that acquisition last year, so we've now had 13 months of running the business. It comes with a fairly motivated team who's doing a lot to make it successful.
00:37:45
Speaker
um So yeah, it's played out well, and it's also diversified us quite nicely. For example, if you saw this big slot that came in with IT services and the lack of hiring and the lack of sort of spending in L&D, I think we were pretty much able to grow the business out a little bit, even after that, mainly because of that. Because we diversified with WebMCG companies and more India retail businesses, rather than just offshore businesses. So overall, the premises worked out fine.
00:38:15
Speaker
And you continue to use the hero brand name there? like No. um ah While we we are transitioning it out slowly. It's almost done actually from a transition perspective.
00:38:28
Speaker
integrity is it emmaticticus or but what yeah It's actually, so what we are doing, a B2B strategy is built around sort of product differentiation. So that team is now rebranded to a sales excellence team and we're building out sales training academies basically. Our view is that people will spend b two b companies will spend ah the B2B clientele will spend a decent amount of money and time on sales training and we are now sort of consolidating all our efforts into a sales training academy business.
00:39:00
Speaker
okay which NIT tried this NIS experiment and but not yeah yeah which they did not succeed. at but yeah what What makes you bullish about this business when there is a track record of previous incumbents who could not crack it?
00:39:22
Speaker
So actually, if you look at that story, right, the NIS part of our story particularly, the B2B business was doing fine. They started spending a lot more time on the B2C side. Okay. Retail, the retail B2C side. And that's what sort of got them into trouble. My personal belief, by the way, I do believe on the other side that there is a B2C business also to be had for sales training, if you will.
00:39:46
Speaker
The problem with bootcamp business or businesses like that where you need to see as a consumer, you have to find the fine line between aspiration and outcome. And when you're unable to do that, that's when you're you know sort of business supporters. So are their sales job available in India? Absolutely. At scale. Can you train train for them and maybe charge consumers for it? Yeah.
00:40:11
Speaker
Yeah, true, true, true. It's it's not an aspirational enough. Yeah, it's not aspirational enough. So maybe I'll meet outcomes. And it's wise versus true, right? I mean, everybody wants to be a data science, but frankly, there are a amount yeah science available in India are very limited. So great aspiration, but frankly, not a lot of about them. So I think you've got to find that right balance and very important right in ah in some of these products is when balance has been going. Okay. Okay.
00:40:38
Speaker
Do you think the corporate training market is like, you know, there are a lot of startups building products for corporate training using LLMs where you have like live mentorship. So for example,
00:40:57
Speaker
some sort of a plug-in where if you're doing a sales call on Google Meet, that plug-in is observing the call and giving you real-time nudges. There are a lot of these nudge-based products you would have ah probably tried out of you as well. um so is that ah like you know the The sales trading market, does it have legs in the long term? Look, I think what you are alluding to, which is almost and you know, for lack of better articulation, I'm going going to call it new aid sales or digitized sales.
00:41:30
Speaker
yeah That ah requires a certain amount of investment and a change in the behavior on the client. For example, we have a lot of traditional clients today that we train hundreds and hundreds of front-line sales. We have now launched a product which pretty much is a gamified onboarding product where the person comes in and gets product orientation through a game.
00:41:51
Speaker
It sounds great. It's got decent results on it, e etc. But getting the consumer to think differently about it is is a big ask. So yeah, I mean, ah does it add a lot of value? I think it adds a lot of value. But you know, as any of these new sort of You spend a lot of time educating the consumer and the sales cycle keeps increasing. So a while I can sell, frankly, 10 trainers tomorrow doing sales training for a bank in one minute. Selling a digitized onboarding platform that helps sales managers requires three to four months in approval from a CEO. So you can imagine what it does to that sales training if you have a sales cycle, etc.
00:42:32
Speaker
But frankly, that's the business and that's the challenge and the opportunity of the business. How do you change the consumer mindset? of don't get Okay, so you're saying frontline sales is like inherently something which needs offline intervention, touch points. No, you can you know digitize it and create nudges and you know you know what are the products that we are now pitching, if you will, and we are creating through this this onboarding platform is is the ability to actually give you product information when you need it rather than, you know, you doing random trainings all day long. Now it requires a significant amount of sort of engagement of the consumer to log in at a certain period of time if you would. Now getting him to log in before his meeting, you know, seemed like a use case that I took for granted, but it's not.
00:43:22
Speaker
Now we're building all sorts of nudges and to your point sort of engagement to and for him to log in so that he can review his product before his meeting. So things like that, where consumer behavior needs to be changed for your product to be consumed is an ask and a half. Sometimes it's worth fighting for fighting that fight, but not always.
00:43:45
Speaker
Okay, you know, we were chatting before this when I told you I was selling hiring as a service to corporates and I see a lot of similar problems in terms of Beyond a certain scale, companies might want to build an in-house training team. It would always be seen as a cost item and there would always be an incentive to reduce that cost. You know, things which I so have seen in the hiring business. I'm assuming those similar challenges would be there in when you're selling training as a service to corporates as well.
00:44:18
Speaker
No, absolutely. The other thing, which I think it's also there in in your hiring market, if you will, is that it's a super fragmented play. Like every person, every, you know, I've i've spent 10 years of my life in a particular corporate. Now I'm going to go retire, but why don't I do some training for you? It leads to high fragmentation, if you will.
00:44:43
Speaker
And so not only are you now competing with these two, three guys who know a very corporate well, and yeah then you're on on top of it, you also have these training departments who have their own sort of offline trainers. I think they're the issue, they're the answer is in the product free tradition. If you are frankly offering the same product as their training department or this one guy they know, then frankly, you know, you've asked for the problem if you will.
00:45:08
Speaker
There, then it goes back to how well you're able to train, how well you're able to differentiate, what is your learning experience and training experience, and are you able to sort of, you know, does scale make that better? And if the answer is no, then frankly, that's your challenge in the corporate training business. And frankly, there is a true challenge today that we face today also. The corporate training business has scale issues. After even five years and six years, this business does about 60 crores of revenue for us.
00:45:37
Speaker
oh know If you look at any number and divide that number by even a half, the corporate trading business in India is at least a billion dollar business. but Why don't we have a larger business, if you will, is a question to be asked and hopefully Hans heard at some point.
00:45:53
Speaker
yeah Okay. ah What are the advantages of scale for corporate
Leadership Evolution and Business Philosophy
00:45:59
Speaker
training? You said that if you have a scale advantages and you build a superior experience, ah what what are some of those things? what is what think go ah One, I think, the and it's finally happening slowly, but it's happening slowly, is the ability to build a sort of ah better learning experience through, whether it's through investing in tech or through investing in better tools, if you will, etc.
00:46:22
Speaker
So I think we are now starting to put some time and money in that in terms of truly because I think that's difficult to replicate for maybe be smaller players or in-house players if you would, etc. So I think that to me is interesting mode where you can actually truly create a ah learning experience. The second piece is bringing a larger ecosystem into the world.
00:46:41
Speaker
Today, you know you can train, I can train if you will, but what if we are able to create an ecosystem where we are able to create the right partnerships, the right mentors, the right, maybe the consulting organizations that can come in and deliver it. I think that's difficult to replicate for most people. So today, for example, when we deliver, a you know for a bank, we deliver ah sort of training boot camp. It's yes, it's our trainers if you will, but also that we entirely built an ecosystem around it that creates a learning experience that is hopefully replicates the on the on the job training rather than just give yarn for a period of time, et cetera.
00:47:19
Speaker
so i think you you're able to Like like if you're able to act so beyond just the classroom intervention like post-training assignments and mentorship calls or feedback on assignments and ah pre-training post-training assessment and stuff like that which Aswan would struggle to do.
00:47:41
Speaker
ah The other piece is that you bring in more more sort of aspects to that train. For example, now we have an old digital lab, if you will. So for example, if you teach analytics, you know we have our own lab, et cetera. You can use that lab. We provide sort of you know sort ofdoor not internships, but more in terms of mentorship on that lab as your coding issue. Now, that's difficult. to It requires a certain amount of time and investment.
00:48:09
Speaker
examples like For example, we have about 350 mentors now that are in plan with us. These are senior guys talk to you know who can talk to you if you will on one-on-one or can talk to you in a group to help you solve your own self. So I think those are the type of things that we need to build. The problem in India particularly in corporate training has been is that nobody in India has ever raised money to build a a large corporate training business. All of us actually wanted to build large D2C businesses and we got dragged into the B2P business. All my pace. I mean, they might have a small B2P business, but none of them actually wanted to do a B2P business. They all wanted to do B2P business. By the way, me included. If you had told me that I wanted a B2P business 10 years ago, I would have told you know I wanted a D2C business. So I think when you get dragged into the business, you always do half a job.
00:49:00
Speaker
And I think that's what we corrected, frankly, two years apart. That's why we're starting to see some numbers, better numbers. These numbers were not great for us. Okay, okay, okay. I want to kind of understand your leadership style. What do you see your role as? You know, what are some of the learnings which you've had ah heading Immarticus over the decade plus which you have?
00:49:28
Speaker
What I think has changed, oh you know, I was telling Sonia this that I think the last two, three years, I truly think that I'm doing things that nobody else can at the firm, which I think means that you have your right size and your right scale has come. So I think that's one piece that my role has changed. but What is an example of something you're doing which nobody else can do? For example, we're doing a lot more M&A now.
00:49:55
Speaker
We're getting companies, we're acquiring companies. Sometimes we're acquiring for revenue, but a lot of times we're acquiring so that, you know, that founding team, if you will, is able to add to my leadership team. And frankly, that will only happen if I'm on the other side of the team. So I think it's an example of, you know, but so I think I think truly You know, I think enterprise should actually, any delight frankly, comes and when you truly believe that this is the best use of my time and this is the only thing that this thing that I can do and add the most money. And I think over the last two years, at least with me, I'm sorry, I can speak for, we have seen that. Because we have now leaders running most of the businesses. We have a decent sort of all underneath them, if you will. So we can spend more time on thinking through new ideas, new products, new M&A opportunities, et cetera.
00:50:43
Speaker
The other thing that has helped is through acquisitions. my I have a leadership team of about eight to nine people. Four of them are entrepreneurs. I have run their own ventures, reached to a certain size but like for a variety of reasons, couldn't scale it up. ah some Some market driven, some noticable from a recent perspective. But I think now now that's helping a lot. Now we can I'm reminded of the You know, day one when I started the business, you asked if I was top heavy and how it helped. I think it's now, now again, and this is helping. Entrepreneurs are running their own ventures, sort of mini amarticuses with an amarticuses is an interesting idea. Okay. ah How do you build for scale?
00:51:29
Speaker
And you know ah you are also an investor in early stage ventures, and you would probably also be advising your portfolio businesses on this. So you know what's your advice to early stage founders on building for scale, especially the organization?
00:51:48
Speaker
One of the lessons, are and it's an obvious lesson, but to you some of the most less ah the most obvious lessons are not very obvious, I guess, is one is like Let's look at the amount of journey. We sold we found a niche. We did extremely well. We dominated in that niche. And then we moved from there and sort of built out other products as usual. In hindsight, solve a bigger problem right off the bat. like So the market size is important as usual because you can do a great job. And I think we did a great job.
00:52:25
Speaker
oh ah building out the first product if you will etc and it did well and it does well but I think in hindsight we should have picked a bigger bigger problem to solve for that's one piece the second I wouldn't call it advice but you know the second piece to um watch out for is that you have to reinvent your job every one two years as ah as an entrepreneur. Because frankly, there is no outside motivation. When you were at Lehman Brothers, somebody else said, yeah hey, you've done a great job, here's a new job. And you moved away from your job and you sort of found a replacement and you moved on. yeah There's no outside motivation. It's you deciding that you tomorrow you want a new job.
00:53:09
Speaker
and So your ability to reinvent yourself, your ability to think through what your, as a promoter, was ah as a CEO, what your next job is, becomes super important. And that almost forces you to then hire the right people and replace you, etc. To be that insight, though, it's very obvious. It takes a certain amount of discipline for you to do. ah One day I decided that I'm not going to be And literally it was that simple of that. Two years ago, I decided that I'm not going to look at ops problems. This is somebody else's problem. They should look at it, et cetera. And that day, from that day on, I decided that I had worked out fine. Nothing broke. Things got better actually. So I think it was my own piece that I was adding value to. So I think ability to sort of reinvent yourself over the next two two years has to come from within you because there's nobody else.
00:54:00
Speaker
what What were your stages or phases? you know Probably in the first couple of years, you would have played a certain role. Today, you are playing the role of ah growth through acquisitions, leadership development. But what what were the stages before this?
00:54:19
Speaker
First few years, I really you know ah see it with a lot of nostalgia, which was very, very hands-on, like doing training, doing counseling, if you will. I think that was pure delight. like ah every Every time a person used to get placed, they used to bring that mithaika box and I used to handle them. So I really look back and I don't want them back, but I'll look back with fondness, if you will.
00:54:44
Speaker
So I think it went from there to you know hiring our first line of managers, building out more sort of properties, if you will, et cetera. I think a period of time over there, more tough, because more tough in terms of you know our growth slowed down. Our profitability wasn't great, if you will. We went through areas of like, I'm not sure if this business is for me, if you will. So there were stages of that too.
00:55:08
Speaker
oh
00:55:10
Speaker
I think our ability to make mistakes and sort of, you know, fail fast almost, but not too fast, if you will, because we've persevered. And I think that's also helped out. It has been important. We've been always open to market feedback, we're always open to talking to more people, et cetera, and learning from it. So I think from a stage wise perspective, I think it was one establishing the first product, then doing more.
00:55:37
Speaker
Failing at some of those, frankly. And then learning, getting some insight into solving bigger problems. The executive education came from the entire idea that the executive education is a big problem to solve for. Let's solve for that problem. I think that's...
00:55:54
Speaker
And now I think it's it's where you have a fairly stable org. The guys have been in their seat for three to four years. They know their job, if you will. We know how to get 20, 25, 30% growth in the business. 50% is a question, how do you do that, et cetera. Now my role is, ah like you said, it's a lot more about M&A, it's a lot more about making sure that the right people are in the right seats. Making sure that we're talking about the brand demand. What are we doing to to do better?
00:56:24
Speaker
better collaborations, better ecosystem. I think those are the those questions I solve for. Earlier, I remember in my mid-career, if you will, if I can say it that way, I used to have a really busy calendar. I was doing 18 meetings a day and I always used to work. I think I spent like Monday, half a day, and I forced myself every Monday, a half a day, I don't do any. well So I think those Those things now, I think my meetings are a lot more, you know, longer. For example, earlier I should do these 15 minute check-ins, which are completely useless. I would just do it. Not for anybody. Now, I think there are a lot more thought through my meetings are alert now a lot more prepared. People are a lot more prepared for those meetings. There's a lot of pre-work that's what we do it. And this pure discussion that is happening rather than, Hey, I did one, two, three. Now what do you want me to do?
00:57:20
Speaker
So I think it's changing. You know, my dad used to say that if you look at your calendar i and I still remember this, if you look at your calendar and there is one or two, if your calendar is full of areas where you have to make hard decisions, then you've truly arrived. I'm like, that doesn't seem like a great idea.
00:57:44
Speaker
Okay, okay. You know, while you were running operations, what were the kinds of metrics that you would track? I mean, you know, as an operator or CEO, when you're in that phase of the journey, what, what kind of metrics should one be tracking? And now you mean, Akshay? No, I mean, when you were more hands on with ops and now also like, how is that evolved? Like the metrics you track, how is that evolved over the years?
00:58:15
Speaker
Yeah. um So we've been, we are manic about metrics. are amor this To the point it's too much data. ah You know, we have, we have actually, literally there's an, you won't believe this, but there's an initiative out there to scale back data and do to bring more insights in because we think over a period of time that we've accumulated the habit of creating lots and lots of data.
00:58:40
Speaker
I don't know given, but not a lot of insights come out of that data. So there's an entire effort out there. And there's a fancy acronym to do it also, um which I'm forgetting, which basically means is forget the data, but give us insights out of that data.
00:58:56
Speaker
So we've been manic about it, whether it's through technology or even it's through manual, et cetera. We have tracked everything from everything from the sales process, training process, placement, if you will, et cetera. And we are obsessive about input metrics, not output metrics. This is the favorite bit, people of mine, that most people track output and not input. And it's very, very senior guys at very, very senior organizations keep looking for output and not input.
00:59:23
Speaker
which I find very strange. So I think we obsess over input metrics. Whether it's you know if it's career services that I, then my input metrics could be as simple as how many meetings a business development person is doing. If it's a training, then my input metrics is how many times the guy's logging in or how much is his attendance, if you will, rather than worrying about what grades he gets. So I think that we obsess about input metrics across the board. I think how it's evolved, if you will, is that
00:59:53
Speaker
like i Like I told you, I think we are now driven around. Earlier, um you know if there was a 30 minute meeting, I used to spend 10 minutes looking at the data. My ask now is, I'm not going to look at the data. I'm not now anymore. Just tell me what the three, four insights that I need out of it.
01:00:09
Speaker
And now we have the right amount of leadership, the right amount of the right people analyzing the data. Earlier what tends to happen in small organizations is you're the only person who can interpret the data. So you are the person who's sort of interpreting the data and taking insights out of it. As your organization evolves and you get more senior leaderships, I think the insights can but of you know can be carved out for you. So now we are at a place and we're not there.
01:00:32
Speaker
where I have a CEO dashboard, if you will, but there I want more insights, less data, if you will, et cetera. So that's the ask, right? You know, most employees tend to favor output not input approach. Like, you know, for example, why do you want me to clock in and clock out and have 10 hours in office? You should just look at how many DSI converted, for example. ah but But what you're saying sounds pretty counterintuitive of inputs should be measured, not outputs. Can you zoom in a bit on that? So that method works when everything is fine. The minute everything goes out of the window and over a period of 10 to 11 years, something or the other always goes out of the window. ah Very quickly, you'll start getting into the input matrix. And then it too becomes too late.
01:01:28
Speaker
but For example, you know in B2B, I find it hilarious when a senior business leader will come and ask you you know What is the revenue this is this month? Let's track the revenue. um I don't know what this conversation is because what are you going to do with it? like That's just a number. But if you don't have your input metrics measured out or your input metrics don't have the right tracking or the right the right targets, if you will. And in this case, let's take a simple input metrics. How many people, how many new people or LND people did you meet on a monthly basis or on a daily basis? If that's not being tracked, then I mean, at the eventual, what do you think?
01:02:06
Speaker
So I find it very, very strange and this is a super super pet peeve of mine and across the board, you know, and I saw this with Lehman also. You know, everybody used to come and talk about Kithnadilwa, you know, what is the etc. But nobody's talking about the input that's going through. So I find it very, very strange that people don't, I obsess over inputment. I don't obsess over inputment. I think it'll follow. I think if your input is right, your tracking is right, to your governance is right. Yeah. I mean, there are some other issues that you could come into that your product is shit or, you know, your go to market is wrong. But if not withstanding that, I think just obsess over input.
01:02:46
Speaker
So you might get a blindsided, oh you know, in the sense that maybe the number of people he's meeting is not important. Maybe there is something else which is affecting the output and not the number of people he's meeting. ah like Like those kind of errors can creep in, right? Like where you're measuring something just for the heck of measuring it.
01:03:11
Speaker
No, absolutely. And it happens. right Sometimes your input metrics are all right, and you're still not getting the right input. But my only point there is, it will consistently happen for one month, two months, but they'll always catch up. And and the education business or the business we are in is a long-term business. I'm not going anywhere. You're not going anywhere, if you will, et cetera. So it's always going to catch up, if you will. And normally, this do happen. You're completely right.
01:03:39
Speaker
And we do look in output metrics also. So we do tie it up. But to me, I think obsessing over input is a better idea than obsessing our output. So obsessing over output conversation is quite hilarious, actually. it like you know you Let's say you're a business developer of mine, and you tell me that, hey, May is a shit month. May is a shit month.
01:03:57
Speaker
i got Can you please make sure, this is the conversation, can you please make sure that June goes well? Absolutely. June is a shit month. Can you please make sure July is month, otherwise I'm going to fire you.
01:04:10
Speaker
Sure. I'm going to try. July is a shit mother of fire. This is not a conversation. Nor is it helping anybody. Nor have you got the guy to think through, you know, what he should be doing differently, if you will, et cetera. So these are, you know, these are conversations that real people, real managers in my organizations and other organizations are having. That's the rhetoric I want to change. ah Very interesting. Super interesting. I think probably operational efficiency, which is so rare is a factor of being obsessive about the input metrics.
01:04:41
Speaker
yeah Interesting. How do you ensure right people learn the right seats? Like that's one of your key roles today. I think you you you are solving for two things, right? And it's interesting with an amount because we have two, three types types of businesses. And bear with me, I'll come to your answer.
01:05:05
Speaker
But the employability business requires concentration on a certain two, three products, if you will, and scaling those products to make them big products. Versus the executive business requires sort of high churn of products, which are aspirational and always the next, if you will, trend. Now, these two organizations need to be completely different from the the type of people who are running it.
01:05:29
Speaker
This requires the level of detail is high. The risk levels are low. The the execution, the ability to execute on ground needs to be high, if you will, etc. Or sort of excel excellence in execution needs to be high.
01:05:48
Speaker
versus here your market feedback needs to be great. So I think you know you're almost solving for different things within Immarticus also. This business is a three-year-old business that's grown 100% year-on-year. This business is a 10-year-old business that's grown 25%.
01:06:03
Speaker
So I'm almost setting different cultures with a demonic issue. Now, if you met a person from this business and at this business, you would very quickly, you would say, yeah, this is a different type. You wouldn't say actually they're from the same firm. You'd be like, you're a completely different guy. You're not from the same firm. But it's not true. They're actually in the same firm. So I think when you build these businesses and specifically happens when you're building these businesses from start, you require a certain, now 10 years, five years later, maybe it requires a certain different type of business from here.
01:06:32
Speaker
Knowing that, it's it's a fairly complex problem to solve for. I find it quite naive to say, hey, this is our culture, this is the type of people we are looking for. And you know I remember my boss used to say, and now I laugh at him, ah is don't hire anybody that you can't have a drink with. This is the age old. A lot of people say this. I find this one hilarious, especially. Because when I came from the US, I couldn't have a drink with anybody.
01:06:58
Speaker
That's what I shouldn't have hired anybody. We've thought to think that you know this is the type of person you're looking for, and this is what's going to fit. I think it's it's a very complex problem to solve for. And I spend an inordinate amount of time thinking about what the org should look like and what is it, as a future proof. And not only is the top right, but is the VP band, the EVP band, et cetera, is right. ah yeah So i'm not I'm not giving you an answer. I'm just telling you that it's a big problem to solve for.
01:07:26
Speaker
Are there some things which you always look for? So one part of your answer is depends on the role, that for each role there is something else which is needed. But across all roles, is there something common that you look for when evaluating people for roles?
01:07:40
Speaker
loved At Amarticus, one thing that I do look for is that you have to like education as a business. You have to like the idea that you're training someone, if you will. And I can tell, I can't tell a lot of things in an interview. Sometimes I get, you know, as old as this, but I can tell this quickly.
01:08:00
Speaker
do you And there are a whole bunch of people in our firm who like the idea that we are in education. And you have to like that. Because to me, this patient capital game, if you don't like it, you're not better staying. I sincerely believe that. oh And if you do, then it truly ah will delight you when when you meet these outcomes. and I think that their excitement is is super important in this business.
01:08:27
Speaker
Because this business has challenges that other businesses at don't. So it needs to have the pluses if you work, etc. And you as a person have to appreciate those. person If you're not one of those people, then maybe you shouldn't be in this business.
01:08:40
Speaker
okay okay Let's talk about a bit of your VC journey. You started Blink Capital. so It's called Blink Invest. It's basically an AIF and we invest in head tech and fin tech. This is a 120 crore fund one. What all investments have you done here?
01:09:05
Speaker
ah We've done um about five investments. now One of them is EdTech and about four are FinTech. They range from so were K to 12, ancillary type of business, which is for toddlers and parents. We've done of so a supply chain, anchor-based financing business. We've done a new age insurance company.
01:09:29
Speaker
we've done a We've recently done a company that runs the credit card programs for large banks, if you will. So I think those are the type of investments. And what made you want to become a VC when you already have like a full-time job of running a Marticus? You know somebody told me it would be easier.
01:09:52
Speaker
um And you know, this sounds like a great idea to sit around and you know, people come pitch to you and you figure out this is a great idea and you want to put some money in it. And you tell them, show me this metric and show me that metric. And it seemed like a great idea to think about. I've realized it's two times harder than three times harder. Because at least at a market, people have to listen to you. Your promoters have their own mind. and So you might have given them the check, but they still have their own sort of what they think is right, if you will, etc. So it's a lot harder.
01:10:25
Speaker
But no, I think ah to me it was a logical next step. I've learned a lot of over this journey.
Blink Invest and Education Industry Insights
01:10:31
Speaker
I sincerely think that there are some things that ah you know we can advise or we can help fellow entrepreneurs to actually do a better job. At least we can tell them what not to do, if not what to do. I think to me that the what not to do list is a lot more important sometimes to even what to do list. So I thought we could add value from that perspective. and the and the The thesis behind Blink is exactly that. beautiful Even at a hundred and twenty guru fund, we have only made five to six investments. The idea is to actively work with the promoter and help them out wherever whatever it takes if you will. We position ourselves as a co-founder in the film.
01:11:11
Speaker
We literally asked for that type that. We want to be positioned as a co-founder. We want to be part and part of your sort leadership team, if you will. We want to help out where we can. And there are some areas that we can definitely help. But there are some areas we don't know enough enough about. We are happy to serve let you take the lead if you want. So yeah, I think it was a culmination that it seemed like a logical step to actually bring a lot of these learnings that we have learned from me at least, building the business out and to apply to other areas. And what is your investment thesis?
01:11:43
Speaker
So right now the sector, I mean, our sector based as EdTech and FinTech,
01:11:48
Speaker
our sort of normal ticket size are one million to two million, if you will, in terms of size. We don't do seed and we want some some traction, whether it's product or revenue, if you will, there's some sort of product fit, if you will. We're looking for promoters, first generation promoters, who,
01:12:12
Speaker
but first generation experience promoters. So we don't do well with. College dropouts. College dropouts and stuff like that. I don't think about that. And second is we are, one of the things that, and it comes from building a Marticus and Amit, who's my partner also, has got similar experience, is that we want to build profitable, sustainable businesses. So we hate businesses that, you know, tell us that. He has got a great LTV, but the first first transaction is going to be at a 500% loss.
01:12:40
Speaker
So I think profitable, sustainable businesses that are going to grow out with a great set of promoters. And maybe this adage of, can I have a drink with the promoter is true here. Yeah, right. Okay. And so why is it called Blake?
01:12:57
Speaker
okay Sorry, sir. You know, I used to have a nonprofit called Bringing Light into Children's Life in New York. okay okay And it was for for people who were visually em impaired. So I ran that nonprofit for a while and in the US, etc. And me and Amit were horsing around with the name and the idea was bringing light into into companies, if you would.
01:13:18
Speaker
and That's how things started. So the acronym is right. Okay. Yeah. Okay. Okay. You know, by the way, sometimes ah visually impaired and and companies are almost the same. So it makes sense for us to keep the finding your way in the dark. Yeah. Yeah.
01:13:38
Speaker
So, yeah do you have like a more specific thesis on what kind of businesses you want to invest in? Like, you know, specific, like say EdTech is one space you understand well. So within EdTech, what kind of businesses would appeal to you? and
01:13:57
Speaker
like From a thesis perspective, we are fairly open. you know we don't want to the you know another problem One of the things that we have talked about as an investment company is that we aren't investing enough in a tick. We made one out of the six investments. One is a tick. And like you said, right and you know our understanding of a tick is fairly strong. um My personal belief is to invest, there has to be a leap of faith.
01:14:22
Speaker
ah There needs to be some mis mystery, if you will. And sometimes, given you run a business also, if the mystery is not there, then you already know what the your challenges are and you are unwilling to sort of take that challenge at a price. So I think that and mystery is important, one. And second is that we don't want to be that narrow and say within a day, we want to do one, two, and three. I think the sectors are narrow enough, frankly.
01:14:47
Speaker
Within that, we have looked at everything from, like I said, sort of a high digital play to an offline university. We actually want to be flexible as long as the the right promoter and the opportunity comes by. So, purely hypothetically, what are EdTech businesses that you wish you had invested in?
01:15:08
Speaker
Yeah, and you would probably know most of the founders and businesses in India. Which are the ones which you think are good investments which you wish you had invested in? I'll change your question slightly. I'll say education business is not a tech business. Yeah. and Okay. Let's do that. Yeah. Yeah. Education businesses. So we're we close to investing in one and we should have invested a lot earlier to answer your question is K to 12 companies.
01:15:35
Speaker
getting the K to 12 schools because the reg space used to scare scare us in terms of how do you sort of position the investment, et cetera. So doing more K to 12, new age K to 12, whether it's IB or it's new age schools, if you will, I think is an investment. We could have invested earlier, but it's still an opportunity now. So I think that's one. but But schools are like nonprofits, right? If I'm not mistaken, like they have to be set up by the trust.
01:16:04
Speaker
Yeah, so I think now there are models if you will, for example, KKR is doing it with Lighthouse and a few others. There are models how to, you know, how to keep the trust in the management companies. ah Okay. ah So I think that could be, and the very fact that you just mentioned that is also where why we stayed away for a long time. But now seemingly the government and sort of, you know, there is precedence in the market that this is, this is legend. And it goes back to with solving a bigger problem.
01:16:34
Speaker
What Ktoroia in India has always done, what the ancillary market, let me go, go sell ERP to a school. Let's not solve the big problem for a small, the small problem. And those companies are not scared. Yeah. It's quickly an intro. Globally, some of them, there's some precedents there. So I think Great New Age Schools investments. I think everybody wins, right? If you invest in a great school, if you will, and truly work on the pedagogy, you work on the <unk> open the work on the but right metrics of the school, I think everybody wins. You get a great learning, you get decent money out of it, and you do There is nothing to lose. Don't you just want it better or whatever
Exploring New Educational Opportunities
01:17:15
Speaker
the most you do.
01:17:16
Speaker
um The other piece that, you know, again, as an opportunity, I wasn't a question early and it's still an opportunity is that we are obsessed over STEM education in India, whether it's finance education or technology education. I think there's a whole bunch of things that can be done. Recently, you know, I've started spending some time looking at sort of, I'm giving you an example, architecture and civil engineering.
01:17:41
Speaker
There are 4 lakh civil engineers that get enrolled on a yearly basis. Why isn't there a sort of scaling space for civil engineers or for architects or for, you know, so I think there's a significant amount of opportunity not there. And I think people, VC investors tend to follow the trend, right? Tech, tech, tech, tech. So let me do tech upscaling and so on and so forth. So I think we have, it's like cricket, you know, in India, no other sport comes other than cricket. It's the same thing here.
01:18:10
Speaker
So, and the VC guys are sort of ah almost it' their own sort of self-fulfilling reality. if you So, I think looking at non-tech or non-stem sectors and sort of doing upskilling in them or doing, you know, that's another space. Third is I think study abroad. It's another space that Whether it's, and I still think the opportunity exists even now, is through pathway programs or redesigning your study abroad experience, whether it's the sales experience or the training experience or the placement experience. I think redesigning that particularly is an opportunity still that is, we're looking at one activity that still exists and frankly we should have invested in one traditional study abroad maybe a long time ago. So these are some of the ideas.
01:19:00
Speaker
Okay, interesting. um I'm somehow not a big fan of study of abroad simply because oh i mean to me it seems like a sourcing channel for a foreign university which wants students who pay them higher than what a domestic student would pay them.
01:19:18
Speaker
yeah But that's what the current model is. But if I change to a vantage a little bit and say, look, why aren't we doing pathway programs? Two years here, two years there. Three, like three years here, one year again. Right. Like today, exactly what you just said, you went there very quickly. So study abroad, sense of an out there. That's what the business model is today. But if you thought about the business model a little bit more.
01:19:40
Speaker
you know, no answer, if you would, then it's, it can add a lot of value because today, you know, it takes, I don't know if you have kids, but it takes two, two and a half crores to get someone an undergraduate degree in a, in a mid-tier school in the US. I completely agree. There's no value for money, but can we change that? Can we, but at the same time, foreign exposure is important. We change that to make it a little more value conscious, make it more consumer friendly. And those are the kinds of questions to answer.
01:20:08
Speaker
Interesting, which is essentially then a college play. Like this is something which a college could do where it has two years in India and one year outside with a dual degree. Now the regulation at least, there are some sort of private players who can do this kind of play also. In education like a lot of these other areas, even fintech i mean you have to be careful about you know the regulator and and what the mandate is, if you will. But seemingly we have a fairly progressive regulator that's looking to do, as long as the outcomes are met and you're not looking to, you know, tug someone, if you will, and we can be a lot more flexible in some of the formats. So we're looking at a company right now that does exactly the part which
01:20:57
Speaker
a two-year instruction in an Indian university and a two-year instruction in a UK university or a US university. And they put the program together, if you would, et cetera, with interventions and master classes and a few other things. OK. So
Entrepreneurial Advice and Personal Motivation
01:21:13
Speaker
let me end with this. What's your advice to young people listening to this podcast? The fact that I have to give advice makes me look older.
01:21:22
Speaker
tra
01:21:26
Speaker
Look, I think if I had to give advice, then let me give advice on entrepreneurship. Because I've spent the last 11 years doing that, if you will. And this is going to be the most cliche of advice. So I do apologize for that. Is do it for the right reasons. Don't do it because you don't want to work for someone else. Don't do it because you want to make it in. And do it because if you want to make an inordinate amount of money, nothing wrong with it.
01:21:56
Speaker
Uh, but do it for the right reasons and know your reason. Uh, I think I meet entrepreneurs who like, for example, I met an entrepreneur kid, you know, two days ago, he said, I started my own company because I don't know anybody else. I told him when you start your company. Yeah. leastsa the hierarchy but Here there is no hierarchy. Yeah. And this can come and tell you anything. Uh, to me, I think find your reason, find the right reason, hopefully.
01:22:24
Speaker
And maybe then you'll stick to it and maybe then you'll be successful. Because as an entrepreneur, anyway, the odds stacked against you don't find another sort of big reason to fail at. To me, I think finding the right reason is super important. And unfortunately, what happens is young, young entrepreneurs maybe don't have the experience or don't have the maturity to know that reason. if you will So it sounds like easy to say, but very difficult to do.
01:22:52
Speaker
ah so thank you so much for time they killed it was a real pleasure so yeah thank you