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The doctor who fixed co-living in India | Nikhil Sikri @ Zolo
184 Plays2 months ago
Every year millions of young people migrate for jobs or education, creating a big market for hostels and paying guest accommodations. However, succeeding in this business depends on managing the operational complexities and getting the small details right. Zolo, one of India’s largest co-living companies, has mastered this challenge, currently managing living spaces for 60,000 people. In this episode, Nikhil shares the management mantra that helps him lead Zolo’s 2,500 employees and explains how he made operational excellence the company’s core strength.
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Read more about Zolo Stays:-
1.Zolo Stays redefines living experience for students and singles
2.How Zolostays is using customer experience to create its niche in the crowded co- living market
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Transcript
Introduction and Market Opportunity
00:00:00
Speaker
Hi, I'm Nikhil. I'm Co-Founder, CEO of Zolo States.
00:00:16
Speaker
Every year, millions of young people leave their homes for jobs or education, and they either end up staying in hostels or paying guest accommodations. This is a massive market opportunity, and even companies like Oyo Rooms were at one point of time trying to make or break into the market.
00:00:32
Speaker
But the challenge with this business is that it is extremely operationally intensive and getting the small things right can make or break the fortunes of a company.
Nikhil's Personal Journey
00:00:39
Speaker
In this episode of the Founder Thesis Podcast, your host Akshay Dutt speaks to Dr. Nikhil Sikri, the founder of Zolo, one of the largest co-living companies in India which is today managing living spaces for 60,000 people.
00:00:52
Speaker
Nikhil talks about his fascinating journey from being a doctor to becoming a management consultant to finally becoming the founder of Zolo. He shares his management mantra that helps him manage the 2,500 people that Zolo employs today and how he has made operational excellence a core strength of Zolo. Stay tuned and subscribe to The Founder Thesis Podcast for more such deep dive conversations.
00:01:23
Speaker
So Nikhil, welcome to the Founder Thesis podcast. Can you tell me ah you know what were like the pivotal moments in your life that shaped you, that made you who you are today? you know When you look back, what are those pivotal moments? Not sure about moments, but there are some pivotal values which have fundamentally made me who I am.
00:01:47
Speaker
One of the key things that, while growing up, my parents used to emphasize is that do whatever you do, it doesn't matter what you do. What is important is you do it with all your heart. It's a it's a small life. I mean, in the larger scheme of the universe, you and I are are nothing. Our lives are such a small duration that, and after 200 years, 100 years, nobody's going to give a shit about you either of us here.
00:02:15
Speaker
in the larger scheme of things, no we don't matter. So instead of taking it nihilistically, I'm not saying it in a nihilism fashion that, oh, since we don't matter, we don't need to do anything. Versus since we don't matter in the larger scheme of things, ah we at least ought to live our lives fully.
00:02:35
Speaker
And that was something that oh my parents, especially my mother used to insist. Do what do you do. You want to play, you play, you want to be a cricketer, you be a cricketer, you want to be a...
00:02:47
Speaker
badminton player you be a player you want to study study you don't want to do anything it's okay sit at home but chill enjoy live life to fullest that's also an option it's not off the table so do whatever you do with all your heart and if you can't do something or if you can't do your core work with all your heart then change something is wrong nothing is more precious than life itself Was your mother working or stay at home? my My mother is a doctor. So in fact, she has four degrees. She has BSc, MBD, has one MD, two MD. So she she inspired me to be a doctor. No, no, no. She in fact asked me not to be a doctor.
00:03:34
Speaker
yeah What made you want to be a doctor? I mean, you got into AMS, which is, I think, the most competitive ah place to be ah yeah you're on in the medical industry, which is the most competitive place. So obviously, you must be motivated to clear ah that. oh I don't know if it was motivation or I had fallen in love with studies or or subjects, per se.
00:03:59
Speaker
What made me choose medicine was the fear, per se, of not being able to clear IIT. I belonged to a very, very small town. From there, Ames, IIT, these things were unheard of. There was one guy who cleared IIT. Which town? Which state? It's a small town called Faridkot near Pakistan border.
00:04:22
Speaker
know So I studied then till 12th there only. So in Faridkut, Eames before me was 16 years back. IIT before me was five years back, four years back, or six years back. And by the time the stories reaches, reach you, right? They're like, that guy used to study for 18 hours a day. That guy used to study for 22 hours a day. And I was like, dude, I can't make it to IIT when I can't study for 22 hours a day. I need my time. I need to play. I just can't do this.
00:04:52
Speaker
okay So in doctor because they have the way have we were in the medical campus or a medical college was there. And I could see doctor this equipment. Let me take a path which seems easier because there's so many doctors around me. This seems to be as you will go because I know all these doctors and they seem to be normal human beings, good human beings.
00:05:15
Speaker
Let me try medicine. When I decided to choose medicine in 11th, then my mother and parents both basically told, look, you're not the doctor type. Doctor types are people who work, who operate in a straight line. Don't ask too many questions. They're happy doing their job, which is a predefined work.
00:05:40
Speaker
You've been asking this question since you were born. Why should I do this? Why should I not do this? In fact, the biggest question of life, like I flunked seventh grade. One of the biggest questions of life was why should I even study? oh so So that couldn't be answered till 10th. And by 10th, almost ah the question started getting answered. I started enjoying science, and I started enjoying understanding the world and through the lens of science.
00:06:07
Speaker
oh so So at some point it got answered, but she she was like that, look, doctors are not too curious a soul. Doctors are more into best practices, more into doing what is their charter. And at some point, but I was too immature. I was 14 and a half when I made that decision. I was the youngest in the class. So by the time I got brains, I was only 16 and a half.
00:06:35
Speaker
So it sort of ah was, ah you can say, immaturity. There was no internet then. ah You could not really go Google it. What actually does it take to go to IIT? All I knew was it takes 22 hours of study and I'm like, dude, that can happen. So how did that die decade at AMS shape you? You spent about eight years, more than eight years at AMS. How did that shape you?
00:07:04
Speaker
I think personality shaping happened in Ames. Value shaping happened during childhood. So at Ames, we were taught to be bold. We were taught to be, and not by just the college, by actually hostel and peers more than anything else. Our Ames Student Union was one of the most powerful unions in the country, and I don't know if it still is.
00:07:28
Speaker
oh Like, for example, in the 1970s when there was emergency, Eames Union was the only union to break the law and get arrested. The entire union got arrested. Then when we were there, there was a youth for equality movement where eventually 20 lakh people across the country participated. It was started by a friend of mine and I was the third follower of his. I wouldn't say started by me at all, even though I was third because I was really skeptical.
00:07:55
Speaker
Because how can you go and change the law of Parliament? and That guy will be hiding. okay But I was the third guy, so I had the fortune of seeing it from... This was the anti-reservation movement, is it? I guess. reserv Yeah, where they suddenly added 27% into central institutes.
00:08:13
Speaker
This is the Mandal covers. 27%. Yeah, Mandal 2, yes. ah Okay. Where eventually we compromised that, okay, you don't cut the general seats, you give seats to whoever you want to give, but just add, don't cut. ah So that movement was started by a friend of mine, very close friend. And as I said, I was his third follower. Wouldn't it all say I was initiator of that.
00:08:36
Speaker
oh so So, we were taught to would never accept the wrong thing. Taught is the wrong word. We just observed it happening and you You just imbibe thoughts. There was a pedagogy here. It's just osmosis. There were people who would do anything when 9-11 happened. so many ah are If I were to continue medicine, our final US exam happens in US if you have to go to US. So many of my friends who were hoping to go to US and suddenly there are no visas.
00:09:13
Speaker
They didn't feel better. They didn't complain. They just found another way, which actually felt that way better. um Most of them went to John Hopkins and Harvard for their student MPHS and another degree. And they completed a degree as well as their medical exam. And that degree eventually helped in the lower end. You didn't want to go to the US?
00:09:33
Speaker
I went to Singapore, not US. okay I wanted to try international first once before quitting medicine because didn't want to repeat the same mistake. Mistake is a wrong word. I wouldn't call him. But you were disillusioned with medicine, like you knew it's not for me. Disillusioned, not exactly that word, ah but maybe the outcome is the same. I somehow could not enjoy that process.
00:10:03
Speaker
I tried it in various ways. oh Like at five o'clock, I will start looking at my watch and like, when will 5.30 happen? And when will it get scooped from here? Yeah. And that's not the life somehow I have ever imagined for myself. It doesn't match with your values. Like like your values, if you do something, do it with your heart. Yeah, I'm a all in guy. like Like the same poker, right? I go all in or I don't go. so I don't like that sitting at the fences or the sides and playing around the sides. And you're specialized in psychology.
00:10:41
Speaker
psychiatry psychology and I tree have slight difference in terms of what i always get I always get confused between the two. What's the difference technically? I tree or psychiatry is basically what doctors choose where it's primarily to deal with medicines to treat patients.
00:11:01
Speaker
psychology is chosen and multiple streams get into psychology where therapy is the mainstay of treatment. Although if you do PhD and become a clinical psychologist in PhD, you still get authority to write few drugs.
00:11:16
Speaker
But as such psychology, mainstay of treatment remains therapy. And for psychiatry, the mainstay of treatment remains medicines. That's the main difference. So you did with that one in the year stint abroad. I practiced three years in Ames also. I just
Zolo's Business Model and Challenges
00:11:34
Speaker
practiced in oncology, practiced in various departments.
00:11:38
Speaker
Oncology I liked from intellectual challenge standpoint, but so it was tough to see so many people dying every day and I tend to i tend to connect i with people and including patients then. So it was becoming a little difficult from an emotional standpoint. I was not able to sort of move on from that.
00:12:03
Speaker
place that it's okay. That attachment was that I couldn't really achieve well. Well, the intellectually I loved oncology, it was a difficult field. oh And fairly complicated, you need to like really be on your toes. So intellectually, I liked that field. But emotionally it was hard to sort of manage, then more to psychiatry, which was mostly you' intellectually both okay, but didn't really click on that angle and the biggest problem was I could more or less see my future. that Today I am a junior resident, then I will become a senior resident, then I will become an assistant professor, then I will become a professor. and then It was more like henry the day I decided I am out was the day I wrote my obituary. And I could clearly write my obituary.
00:12:56
Speaker
some parts, I mean, I won't remember about him, but that Dr. Nikhil Sikri was a great doctor. He was kind to patients. He really worked in the best interest of the patients. Then he graduated from here, then became like I told you, right? Junior resident, senior resident, professor, and died. I was like, no, no, no.
00:13:16
Speaker
and this so why has to be little more interesting than that ah I might go down in the history saying Dr. Nikhil Seghri was a weird crazy-ass guy who started as a good doctor, then was selling chai on the streets, or was selling nadi al bani on the streets, and then unfortunately couldn't make it, and he died on the street popper. I'll prefer that arbitrary, ah then I'll prefer that he went in a straight line.
00:13:46
Speaker
And that line culminated somewhere. So that straight line was a challenge in some sense. I wanted uncertainty from life. And as they say, be careful what you wish for. One day. fuck and I think short is too much uncertainty. Now I sometimes wish God, come on, like one week, one week of certainty without anything going off.
00:14:13
Speaker
yeah sos it's fun was to be kill like you you decide You went for an MBA then, like straight after once you wrote your obituary, you started applying for, why why did you think of an MBA? It's a good way to change your path, right? Like you invest a year or two and then you will get a job and into a new domain with a reasonable degree.
00:14:33
Speaker
For doctors, the I don't think there is any other way to enter business. ah If you enter without MBA, you get this typical medical transcription jobs and all that. You don't really get any core business job ah per se. So for me, it was not really a choice, choice so much. There was no other field for me to crack business side of the world.
00:14:56
Speaker
so Plus MBA being the generalist course which little bit I knew, so it I knew that okay there will be a lot of choices post MBA as well. and And including my likeness for the subject then, which was finance. I used to trade a lot. Factor paid most of my ISB fee through my trading profits.
00:15:18
Speaker
to Then, but ah core finance jobs, when I got to that, I realized, oh dude, this is same shit as medicine, man. This is like, This is rules, rules, rules, rules, accounting standards, this standard, that standard. I'm not doing a classic finance job. I mean, trading was fun, but and nobody wanted me to be a trader, in India at least. There are very few trading desks in India, most prop desks, and very few like real trading, large desks.
00:15:46
Speaker
oh So nobody wanted me as a trader, typical finance job, I wasn't okay. Then luckily I oh i found consulting and the run-up to consulting was really fun and I would say that one of the most life-changing experiences was a couple of months of preparation that we did for consulting consulting interviews.
00:16:10
Speaker
where ah basically you master the art of structured thinking. And that has oh contributed a lot to my whatever limited success I've had so far. That has contributed a lot to that success is how do you solve problems like For somebody who's never given a consulting interview, worked in a consulting company, what's an example of non-consultant thinking versus consultant thinking? That structured thinking, can you help me understand it for an example? That a non-consultant will solve a problem like this, but a consultant will solve it like this. Let's make it more fun. Why don't you throw any problem at me and let me try and structure the answer for you.
00:16:58
Speaker
OK, interesting. OK, so let's say you know I think that there is so there's something I'm personally currently kind of experimenting with. There is a need in the market for career services for mid-level people. So you someone who's at, let's say, 30 lakh salary, he doesn't necessarily get his next job by doing a course from an at-tech. There are at-tech companies who tackling the more entry level. So is there a way to monetize this opportunity? Mid-level career professionals who need help, maybe they need help more generic, like how to make a good CV, how to ah work on yourself, so that whatever. and so So okay, so here's my problem statement. Is there a way to monetize? so yeah Sure, sure. So I not even address exactly the problem statement because structured thinking doesn't allow you to come to answer, rather answer has to reveal itself.
00:17:53
Speaker
So first of all, I will start with, is there a problem? oh First and foremost, if there is a problem, yes, then what are the ways to solve the problem?
00:18:06
Speaker
if you solve If you find a way to solve the problem, then which of the way will be a scalable way? are you Actually, I missed because we are doing libraries on time, so I missed some bits. I'll go back also. Before, is there a problem? Why are you even trying to do it? Because you have to start with that start pro thought process. Why are you even trying to do it? What are you looking to gain out of it? Is it a lifestyle business or is it a scalable, funded business you're trying to do?
00:18:31
Speaker
If it's a lifestyle business, the approach goes very different. If it's a scalable business, the approach goes very different. If it's a lifestyle business, then what is the investment that you're willing to put? Are you willing to put only reinvested profits into the game or are you willing to put some capital that you have saved so far? If you're willing to put reinvested profits, the answer is going to be very different. If you're willing to put some of your skin in the game, capital in the game, the answer is going to be very different. If you want to do it in a scaled offering, do you have enough credentials and credibility in in the past to go and convince a venture capital fund?
00:19:03
Speaker
or Angel Fund. If you don't have credentials and capabilities, then the answer is going to be very different. If you have, the answer is going to be very different. I'm not saying you can't do it or you can't raise money. If you don't have credit credentials now, get credentials now or start the business. There's nothing better than proof of the business as a business itself.
00:19:20
Speaker
So, you will basically cut the problem statement into various various species and a different thread, the answer is very drastically. oh So, and each thread as you keep peeling down, let's say if I peel the thread of lifestyle business and I don't want to put any capital of mine for the time being. Then if you don't want to put any capital of mine, if it's a lifestyle business, then obviously it has to sort of grow organically.
00:19:45
Speaker
For it to grow organically, do you have the first set of customers in mind? Do you have the first offering in mind? What do you mean by offering? ah When you sort of think about offering, what do you mean by offering? When you've defined that they need guidance, what do you really mean by guidance? Is it just Gyan or is it like actionable steps? If it is just Gyan, then or maybe it's both. If it is both, so I hope you're following the thread. I can go on for next 45 minutes. yeah okay but you Getting the point, what I'm saying is that you structure your thoughts are in a structured approach to a problem solving. It allows you to get a lot of clarity in your head. It allows you to not get confused. It starts with the agenda. I mean, different problems will have different ah frameworks as well. There is no one framework, framework structure. yeah approach You will have hundreds of frameworks to solve in real life.
00:20:38
Speaker
And it is so surprising that they don't teach this in a B-School. Like, or at least at my time, they didn't. I don't know if it's safe. They don't teach at B-School. You got to learn at B-School with your peers. I mean, and that's what I said. Three months on to the preparation were magical or amazing.
00:20:57
Speaker
because we all, we had a group of four or five people who used to keep doing cases. And at some point it had become our second nature of thinking for like five, or six of us and maybe more. I don't know what it is. Like no matter what we'll see, like if we'll see like one day I remember we were all like, dude, we need to stop this thing. So we're sitting in an auto and we see a poster of South Indian movie where there was a sort of a, I wouldn't say very nice short of a actress and a actor being a very macho sort of thing. And then we were like, why does this happen? Then one guy is like,
00:21:34
Speaker
um Because at least the two key variables or two key value offerings that people are looking are mostly around the physical aspects and that's very commoditized. For a hero, they are bypassing physical aspect and they're getting into style and psychological aspects, so that's more nuanced. There's a capability to build a differentiation.
00:21:53
Speaker
just stop and stop yeah so oh So yeah, so but you have to learn, I think the best place to learn is to be schooled, they don't teach you, there that's all different thing. True, true. So you've gone into Deloitte, thanks to this preparation. What next? Like, you you didn't like it at Deloitte? Because you left within a year, I guess, of joining. Yeah, and I was clear, I wanted to start up, I in fact, wanted to take the ISP program of dropping out. And there's some entrepreneurship program where you can drop out and create certain placements again.
00:22:28
Speaker
okay But at that point, for the first time in life, my parents asked me something. They were like, i we are not able to appreciate what is your all problem with bread and butter. at some point, like whenever you start earning bread and you're like, oh, no, no, no, no, I don't want it. so no That was the first time they had asked something. They had asked basically work for two years. If it doesn't work for you, quit it. So I worked technically for almost two and a half, three years, one year in Deloitte, two years. And what was it?
00:23:03
Speaker
I was supposed to work with India market entry of Cerner products. What is Cerner? Cerner is the world's largest healthcare IT company. So they sell electronic medical records and some other products. So I was supposed to leave the India market entry for Cerner. Okay. So their clients would be hospitals.
00:23:26
Speaker
Hospitals, even companies, so there are some wellness products, et cetera. So we were trying both sides. We had some early success with government and one or two corporates. oh Some approvals inside never moved. But that's anyway, i now I can understand why at that time I used to be, what the hell is this? Now I totally understand why. At that time I had a grudgy feeling. Now I have zero grudgy feeling. where i can why Why is it like, why why why weren't they able to sell in India?
00:23:56
Speaker
no No, there were some clients who wanted it. But with some government clients, so ah the the organization saw a brand risk. oh And for some private clients, the cost of changing the product was not making sense, especially given that majority of that product for the corporate clients was given out of US, not out of India. So US ah cost per hour is too expensive.
00:24:22
Speaker
So that time I felt that, oh, you're not thinking straight, why are you thinking about brand, risk, trend, risk, let's do business. Brand is much bigger than business. Brand is much bigger than couple of dollars there and there. So that's okay. At that time I felt a little off, but now I can totally understand that it was a very sound and a good way of thinking. So what led to Zorro? After Zorro is when you started Zorro, how did the idea come to you?
00:24:52
Speaker
So, Akil and Sneha were already working on an Edtech product and I was sort of moonlighting with them. And how do you know Akil and Sneha? Akil I know since I was 2.5 years old because he's my younger brother. Sneha and I met in Deloitte.
00:25:15
Speaker
okay So, these guys were sort of working on an Edtech product. I was also pumping all my salary into that. And at some point we went bankrupt. We had like 300 bucks left. At that time we had to choose like either go back to our jobs or give it, give one last shot in terms of trying if we can raise some capital from outside on some idea. A tech was taboo then.
00:25:48
Speaker
2013 is what I'm talking about. It was a big taboo because so many good souls had killed themselves trying to educate schools on that they ought to do something about their curriculum, etc.
00:26:06
Speaker
And then we moved on. We were searching for a lot of ideas. We were piloting, testing. And in that search, we stumbled onto to this PG market. I still remember going to Kundana Ali. There is an area called Kundana Ali in Bangalore. And for as long as your eyes can go,
00:26:27
Speaker
There are PGs. As far as your eyes can go, there are just PGs, PGs, PGs. And I was like, dude, there is a 200 gold business to meet my right and my left.
00:26:39
Speaker
not record let's Let's just get going. And also the problem statement really, really sort of appealed to us because the quality at that point of time was horrible.
00:26:54
Speaker
Now, quality has still improved drastically. like Again, that's one thing that sometimes when people ask me that what is the most, that is the one thing that you're really proud of after starting Zolo, is that we've not only done whatever we have done, we've really uplifted the entire industry by a very big margin. So if Zolo is serving 60,000 people today, in Bangalore alone, there are 10,000,000 people who are really living a great life.
00:27:24
Speaker
because Because some point people realize that look, if we don't up our game, these guys are going to kill us like anything. And they are also micro entrepreneurs, right? They're not DDS. They also up their game fast.
00:27:35
Speaker
oh So we sort of uplifted the entire industry by a very very big margin and that's something I'm really proud of. So today even local guys if you go to are not really pathetic. I mean good bad I don't want to comment but 10 years back it was so bad that one of my co-founders literally puked when we entered a property to just do some surveys and ran out and literally puked it was so bad.
00:28:02
Speaker
ah So we we felt that it's a good thing. I think we can make a good commercial outcome here. ah There is a tech play here. There is a heavy ops play here. You're really touching a lot of lives directly and indirectly. Like I said, indirectly is actually much bigger contribution of ours than even directly.
00:28:23
Speaker
oh So that sort of felt right and we started on the play. and Luckily, did you hi you know as a consultant, you must have done some sort of market sizing like what's the time here and all. And like, leave tell me that what you thought as a consultant and did that actually prove to be true or you know, because there must have been some naivety as an outsider initially.
00:28:49
Speaker
Right in India till 2021, every market size was inflated by 5X. Okay. And why you said till 2021? After that, did the estimate come down or did the market go up? but no No, neither. It's just believability went down.
00:29:09
Speaker
Money is cheap, everything is believable. If money is not cheap, then everybody wants to dig deeper into 10 levels and 10 levels and 20 levels. So till 2021, when Fed had zero interest rate, money was cheap. They were seed rounds of $100 million. dollars So there was one company, I mean, we we all everyone would know, seven months it made to a unicorn. They didn't even have a full product yet at that point of time, in a sense. And there was no plan of monetization, but we are a unicorn. One billion dollar is something.
00:29:44
Speaker
8,000 crore valuation. it It means something. There are banks decently doing small size cooperative banks which don't get to that valuation and they make money. They make like real shit lot of money. yeah ah So till then though all market sizes were very believable, very large. yeah It was not just our way of thinking. Like how did you think about it? I just want to hear that thought process.
00:30:12
Speaker
ah We went down from the supply side. So our assessments haven't changed for the last 10 years a lot. When you do demand side assessments, then you can go really off. We went from supply side. What is the difference between demand side supply? So demand side will be, there are 100,000 employees.
00:30:32
Speaker
sensitive but data 20-40 crore people, out of which these many are migrants, out of which these many will need, out of which these many will not need, etc. These start from supply side, total number of buildings, total number of PGs, total number of this this in Bangalore, how much we know. Our estimates have moved by like only 20-30%, which was basically some extrapolation we did of that these many buildings will be there, turns out slightly lesser.
00:31:04
Speaker
oh But fundamentally, we have we haven't changed our estimates a lot because there were more supply side estimates. And you has made your estimate of the market size or of your projected revenue? Which estimates are you talking about?
00:31:20
Speaker
Market size, market size. Projected revenue, obviously COVID came, so everything went for a toss. If it wouldn't have been for COVID, life would have looked very, very different for Zulu. and oh So if your core market... Coming back to that but initial stage, so you were standing there and you saw 200 crores of business on your left and right, then what? Then we raised money from Nexus as C-drowned. Purely on the idea.
00:31:50
Speaker
idea in some basic execution of a month and a half. What did you do? We had built some tech. So we had gotten to some primer face seed product market fit, where we could see a scope for curating a certain set of inventory for customers, very similar to OO model for PGs, the OO initial model. Okay. So that sort of clicked well. Which was like a demand aggregation basically.
00:32:19
Speaker
Yeah, demand aggregation for the most part. Although we moved to full slack model within one year of that, because we realized here in nature, like ah oh because if you if you're not building a brand in terms of strength of yours, to demand aggregation alone to nature, like that's not enough, because people are not switching so often.
00:32:40
Speaker
In this business, at least. In any business, I feel that pure demand aggregation can work, but not risk-taking or inventory-taking demand aggregation. oh So like who you has now? What is that? mind surgery I didn't understand. What do you mean by that? Pure demand aggregation can work, but not risk-taking.
00:33:02
Speaker
So OU right now is a pure demand aggregator. Right. ah so You're not giving any guaranteed revenue to the hotel. Right now is a pure demand aggregator.
00:33:14
Speaker
The previous model they had was, look, I am giving you some guaranteed. I am taking inventory risk alongside you, okay but I'm not managing operations. So that's a very tricky model where so who is taking ownership of the customer sort of gets divided because that person doesn't have a financial risk involved in taking ownership of your customers because he's been paid for.
00:33:37
Speaker
And you are not taking ownership directly. It's indirect. It gets very tricky. So today's model is a much poorer and much more scalable and much more leader model. no And our model was that eight years back, 10 years back, 10 years back, not eight years back, but it didn't feel enough for a PG segment because people didn't switch every day. Like in hotels, demand sort of walks out every day. So you need demand aggregators, even if you're a great operator.
00:34:05
Speaker
in in In our business hostels, PG's co-living, the customer stays for a while, whether it's three months, six months, 12 months. So you don't walk out every day. So we decided to become a full stack player. And that was one of the best and the toughest decision we took at that point of time. Because at that time, full stack was not the flavor of any venture funded company.
00:34:33
Speaker
Yeah, yeah, yeah. The the basic VC funder is asset light. And yeah, like I mean, we were technically very asset light. ah Like our expense on low touch asset light, high tech, like that's typically the Yeah. So yeah, low touch was the main mantra oh that do something which is much wider and low touch.
00:34:58
Speaker
ah more aggregation sorts on the side. oh And any amount of burn on that side was okay. But even two rupees this side was like, what is your OC? What is your ROE and all that stuff. So, so that was a very different sort of way of thinking at that point of time. So we struggled, like we really struggled to raise our first series a after seed, like really struggled. We almost came close to bankruptcy twice.
00:35:28
Speaker
that was quite what are your costs I mean, one would be cost of your corporate employees, but you also had these rental incomes and rental costs, like you would have taken some long-term rental agreements and then given it out, like they must have been. I think essentially the business model here is pay 100 rupees rent for one set of building with X number of rooms and then rent out each room in such a way that the 100 you're paying, you get back 200 individually and that margin in between is what you use to cover your operating costs, customer acquisition costs. Yeah, roughly sort of, that's the play. oh But our centers were making money, so they didn't need money to be supported. We needed money to grow and invest as well as in the team, as well as more centers. oh So our centers were making money there. Customer acquisition also from like last 10 years, our cost is very reasonable. here so
00:36:29
Speaker
Including CAC, our centers, CAC loaded, they were making money then, they are making money now. We've never lost money at a contribution level, okay even during COVID for that matter. During COVID also, we were able to sort of work with our asset partners and then get everything in a way that we didn't lose money at a contribution margin level at center. But you need to grow the business, right? I mean, period right you can't just oh keep sitting The corporate yeah have a cooper team, yeah corporate team
00:37:01
Speaker
tech cost. You can't just keep sitting there. I'll run three centers because they're profitable. That's was never the plan that will ever be the plan. So it was a very tough one year, very, very tough one year.
00:37:15
Speaker
oh And eventually, I think Nexus only realized that they can look together good, they can do some good work. ah Let's just give them a small series A. so that's a c said Was there some data point which changed changed their mind?
00:37:33
Speaker
like We were growing consistently, we were profitable, not at a EBITDA level, but always at center level, minor loss at EBITDA level. ah We could clearly see the market size that is large market to be built here. And high retention rates. I guess here retention is an important factor to evaluate.
00:37:56
Speaker
and Not really in our business because we don't have just employees. We also have a lot of transitionary customers. In fact, now to our properties also operate a lot on daily stays as well. Because of recent GST changes, we've been classified as hospitality.
00:38:20
Speaker
So, we pay same taxes hotels pay now indirect taxes, indirect taxes and same structure more or less. So, in properties where we pay direct hotel structure tax. So, in some sense we have the license to also accommodate on and off some daily stage as well wherever we have fringe occupancy.
00:38:42
Speaker
Okay. So, but yeah, I mean, when, when we started, yes, at that point, you can say that thesis would have been built that way. But this businesses are truly businesses of sweating assets, whether you sweat it attention, whether you started by diversification, fundamentally, you have an asset, like you said, you are paying 100, you got to make 200.
00:39:02
Speaker
And if you can make 250, nothing like it. So whether you make this through retention or you make this through magic, I don't think anyone cares. Right, right, right. Okay. Okay. Understood. Understood. Okay. So ah Nexus gave you a series A and by that time you had three centers in all three in Bangalore.
00:39:24
Speaker
Yeah, i we were just in Bangalore then. Okay, so after that series is in then what happened? Then we started Pune first, da then came Chennai, then came Hyderabad. Now we are in our teen cities. ah Continue to double down on Bangalore only.
00:39:42
Speaker
like, you know, because you probably need an ops team, right? ah Like maintenance guys, AC not working, whatever. And you probably need some sort of, I mean, it's a team, you need an on ground team. So it would make sense to have density. Oh, yeah. So we even wise, then that's all the answers. Okay, thank you for being so candid.
00:40:07
Speaker
okay We should i have built Bangalore much deeper and then moved to something else. Everyone asks, are you a national player? Are you a local player? And entrepreneurs are humans here. They are mere mortals who who have those petty emotions of Sometimes yeah that side takes the better of you. right right life If I have to now do it again, I will first make sure I am a God in Bangalore, then I'll touch anything else. oh so
00:40:47
Speaker
but yeah Things, time, situations, majority, that's fine. Okay. Okay. Just continue the journey. So you went into multiple cities and I guess you did a big series B around 2019. So by that time, how many centers, ah what kind of ARR were you at, do you remember?
00:41:09
Speaker
now Don't remember a lot around the error. I think we were at 120 crore run rate or something like that. Okay.
00:41:22
Speaker
and twenty one thirty load hundred and okay and We had a fairly large series A, series B of that time, the largest in co-living at that time at least. 30 million. one of the Yeah, one of the largest of those times as well.
00:41:39
Speaker
oh so oh yeah i mean After series A, life became relatively better because we had some capital to deploy. We could show our numbers. Payback periods were making sense. Growth was making a lot of sense. We were growing 250% here in the year. so Most of the things were sort of falling in line. Series B happened well. Then we expanded even more aggressively.
00:42:09
Speaker
oh In fact, till COVID game, life was like really, really on an upward run. And then in, I think, a few moments when Mudhiji announced, I'm going to say, bahani nidleya.
00:42:26
Speaker
suddenly life came down. Life didn't come down crashing. I don't think um life has ever come down crashing. I have always remained an optimistic sort of a person no matter what the situation is because I believe the only choice I truly have is how I react to the situations, not what situations are. I can't control the world but I can control how I react to it.
00:42:52
Speaker
ah For life, assets never went bad. Life was good only i always, but business really took a beating. Business really, really. How much runway did you have when COVID hit? I think...
00:43:07
Speaker
That time we had 10-12 months runway, but we were, our investors were kind enough to do ah another CDC during the COVID period. So that gave us a very, very long runway. Yeah, I was surprised about that. You did a $56 million CDC, which is a massive, massive CDC for a company that is so badly hit by COVID. I mean, for a sector that is so badly hit by COVID.
00:43:32
Speaker
Luckily by then we were not hit actually. okay Because the first lockdown was so sudden, ah people preferred to stay in Zolo because our standards of dealing, etc. were way better than the near term world or the surrounding world. So people were staying with us, our revenues didn't take hit in the first lockdown.
00:43:53
Speaker
very limited hit. It was the second lockdown where we got really hit and and the hope at that point was that it will it will not go beyond like three months, six months, eight months, sort of a period. No one knew that it's gonna go till two and a half years or something. ah Companies are going to announce things like work from home is my primary motor of life. And no one anticipated any of that. So our investor's thesis was also that look. oh And when we were doing really steady in our revenue, we hadn't taken any hit by then.
00:44:33
Speaker
So it was like that, okay, in a few months, life should be back and Zolo is doing a phenomenal job in terms of growth and phenomenal job in terms of retention also in some sense because the revenues are not yet, people are paying money. In fact, during second lockdown also, a lot of customers paid money just to block their bed. But when it sort of kept dragging, dragging, dragging, that point, everyone said that, dude, this ain't ending anytime soon.
00:45:02
Speaker
oh And that's where I think the real down had started for Zola, not really at the start of COVID, but a couple of months, like seven, nine months after COVID.
00:45:17
Speaker
Basically, when people were talking of the new normal as being work from home, like remote as the new normal, people started talking of that the new normal is remote work. less yeah People would have decided to give up their accommodation in cities, go back to home. Right, right, right. right so And that also, I used to always say that, look, this is stupidity.
00:45:42
Speaker
There is no new normal called remote. You cannot build organizations remotely. Because in the end, what's an organization? It's just a bunch of people who believe in something common, who agree to a certain modus operandi of operations, which works for them, who trust each other, that look, I got your back, you got your, I got your back, you got my back.
00:46:06
Speaker
oh people who sort of are motivated by a common cause. So ah by setting everyone removed, you can't do any of that. Diento, everyone is just a transaction agent. Everyone is a freelancer. You give me 20 bucks more, I'll move out. I'll move to some other. And that's what we are seeing and we saw also drastically where the attrition rates were through the roof.
00:46:30
Speaker
Because look, if i alone I am like Ethan Hunt, this packet will self-destruct itself in 20 seconds. If I'm operating on packets of information, oh i can't I can't connect to the cause, I can't connect to people. It doesn't really matter. My ecosystem, my lifestyle doesn't change if I move if i open the packet from an X company versus a Y company or a Z company.
00:46:54
Speaker
My lifestyle is more or less the same. My lifestyle is dependent on my society, my friends, my nearby, and it's very limited contribution via organization. So I was always, I mean, I would have done hundreds of webinars at that point of time as speaker, but in majority I would say that, and generally people used to say, sir, you have vested interest to say that. And I would do that.
00:47:20
Speaker
I have vested interests, but I'm really not coming from that place. I'm really coming from foundational blocks of building an organization. I'm really coming from logic. I'm really coming from culture ah that if you, I mean, as a small startup, 10, 20, 30 people remote can work magically. You guys can meet on and off and etc, etc. 15 people. I guess there is a use case for remote as well. I'm not saying there is no use case for it.
00:47:47
Speaker
I'm talking about organizations who have 150,000 people, 200,000 people, 30,000 people, 20,000 people. right So I'm not saying there is no use case for remote, even then I had the same standard. Look, if you're a 10, 20 member organization, maybe you can manage remote easily.
00:48:02
Speaker
You can all you come on one con call and all share your joys and sorrows. But do you really think you can bring 500 people on one con call and share joys and sorrows? One business leader to home, there are like 1000 people indirectly reporting, you need a town hall, you need that in person pieces. And it's impossible and impractical to keep flying people on and off to meet each other. It just doesn't make sense. And like I said, and the most important thing, what are you really connecting to?
00:48:31
Speaker
You're not connecting to anything other than a packet of work. I haven't seen any anybody doing great work or any company doing great work. If people can't really connect to some cause, even if the cause is not philosophical, like sometimes the some people have philosophical causes like Steve Jobs, I will change the status quo. I will change the way world operates. It's a very philosophical sort of a cause, really not financial cause.
00:48:55
Speaker
But some causes can be very financial also. Dhirubhaya money, very financial cause. Dhanda Vanana. And people weren't there with them. He didn't do it alone. And then his, in some sense, vision used to be that if an Indian spent 1 rupee, 10 bhisa will be viralized. I will be so pervasive in the lives of an Indian. So it's sort of coming from a very financial direction. But still a very beautiful vision and a cause. I'm not... It is. I was talking about rubas.
00:49:26
Speaker
So I'm not putting one superior over the other. oh That Steve Jobs is better than Dear Bhai Mani. If anything, I probably prefer Dear Bhai Mani's vision over Steve Jobs. oh so ah So, but there has to be cause to sort of align. hello And that cause requires a certain amount of proximity, certain amount of spontaneity. I can't like do a water cooler conversation on a Zoom call.
00:49:53
Speaker
Yeah, yeah drunk but back to neck yeah when you know the after seven, eight, nine month period of lockdown when it was like wave two and new normal and all. So how much did your revenue fall by and how long did it take to recover? We have. Then we went down to like 30% of our previous revenues after one and a half year roughly. And it took another two and a half years to recover. So roughly you can say four years of sort of wipe out.
00:50:28
Speaker
oh Which is all right. I mean, no grudges like I said. so You must have, you know, the behavior of an entrepreneur when things are going bad is typically to try a lot of things. ah What were the things that you tried? You must have done more experiments in that time when revenue is falling. I think when things are going well, you tend to experiment less. ah When things are going bad, you do more experiment experiments. Some of them scale up, some don't. but Tell me about that whole period of how that transformed Zolo and you as a founders. Yeah. So in fact, and that's exactly what I was in Samsung Nestle also going, thanks for a nice articulated segue. So we accelerated our vision in terms of what we had always sort of thought. we were i mean And our vision statement after a couple of months in the beginning was never to be ah just a co-living player or PG segment.
00:51:28
Speaker
we were building our operating system tech as well as ops in a way that we can handle any kind of living space. Any kind means any kind, whether it's a hotel, whether it's hostels, whether it's student hostels in outside campus, inside campus, whether it's a society, ah whether it's a army barrack, you give me a living space and we can manage. So that was always our vision to sort of operate on.
00:51:56
Speaker
So we accelerated certain pieces of that vision. ah We started working with campuses, student housing to manage different, different campuses. With God's grace, we have now 30,000 plus students on that side, which we will manage oh as on campus. customers This is like a ah per room per square feet per person. How do you price the service?
00:52:20
Speaker
Per person. It's like a SaaS. It's like per user, active user. If there is a person staying in the hostel, you pay me if not. Oh, and how do, how deep is your service? Does it also include managing the cleaners or is it? It's a turnkey solution. No, no, it's a turnkey solution. Higher cleaners and janitors and like, okay.
00:52:44
Speaker
So operating operating system remains same. So operating operating system is the same in co-living. So we hire people here also. We hire people there also. Higher slash you have agencies, that's a different question, but we are accountable for that. So we hire- With a hostel, why are you charging per person then? I mean, because yeah and normally a hostel would have had the person running the hostel, like say a college has a hostel with it, they would have had to bear those costs irrespective of utilization.
00:53:14
Speaker
um Why are you giving them that optionality that if your utilization is low, then you're paying lower to me? That's fine. I mean, that's just a way of finding a model, right? You can put it more when the time there is utilization. That's just financial modeling. It just keeps the business cleaner, a deal cleaner. It is financial modeling. I mean, I'm not doing any charity on anyone. There is no largesse here.
00:53:42
Speaker
It's just a financial model. You load a little bit before so that you know that when you have less occupancies, you have some fixed costs which will be covered. So it's prima facie, a way of modeling, and nothing no largesse here. go So we, I mean, the the model really scaled up because it's a win-win for everyone. Whatever minor increment we charge to the college, oh the student is more than happy to be way more in some sense.
00:54:12
Speaker
Because it's like ah somebody who's not an expert at something does X quality. Somebody who's an expert uses the same raw materials and cost like a sculptor. So you will use the same same kind of clay.
00:54:28
Speaker
same tools, but the outcome is going to be very different. It's just that the artists, the expert artists might use a little more time. So it's slightly more expensive as such, but the outcome is drastically different. ah So with slight increase in cost, most colleges found a drastic increase in value to the students.
00:54:46
Speaker
and students were also more than happy to compensate for that. So college wins because they get hassle-free management and they get a happy student. Also, sometimes they get slightly extra also, more than more and above Zola's fee by the student because student is really happy. can Look, if in 10,000 bucks you were giving me, let's say, ah some Xiaomi or something, some Android ah comparison, let's say, and in 12,000 bucks you are giving me an iPhone,
00:55:17
Speaker
ah Wow. I mean, charge me 13 also. I don't care. Yeah. I mean, there's not trying to down shaos yeah i so but i put in context, not saying Sean is bad. I had to just pick new known brands as an entrepreneur. One thing you realize is that building businesses is very difficult, dude. Someone has built a It's not sexy, but it's not. Apple doesn't mean it's not great. It is a great business. So all kudos to Xiaomi. I really didn't mean any disrespect to them. Okay. And i like you give some sort of an app to students. with What does your app do? You would have some sort of a resident app, right? for Yeah. just so We have two apps. One is a resident prop property app, sort of but of lifecycle management app.
00:56:08
Speaker
And second is a community app. We are the perhaps only company in the entire, I think, as far as we've done the survey across the globe, which has a separate community management app. So we have a gamification app in community where whatever you do for the community, in the community, with the community, like if you attend something, participate something, select something, you have XPs, gems, and then you you can attack each other. You can send your armies, raids. So it's like a fun game, like a really fun game.
00:56:37
Speaker
Okay. ah And then Lifecycle Management app obviously, we're housekeeping, repairs, maintenance, fee, exit, entry, onboarding tickets, feedback. So all that happens. Laundry, entry, exit, passes. So that's a Lifecycle Management app. Okay, so ah You know, I think that the difference between a WeWork and other co-working spaces was their community angle. Like they would position themselves as come join your tribe, tribe of builders and doers and like, you know, they had the cool community kind of a positioning and parties and beer on tap kind of stuff and all.
00:57:16
Speaker
So is this like a play that you have also seen working for Zolo? And if yes, then how do you build community as a moat? And is it a moat for Zolo? Like two questions combined I'm asking. So I'll say yes and no both. Yes for a store and housing business, no for co-living business. For co-living business, the key moat or value proposition to the customer is flexibility.
00:57:44
Speaker
that you can come for a day, come for a month, come for a quarter, come for a year. And all options are are available. You have different, different packages. You can choose from whichever you want. oh So for co-living, it is a quality hospitality that you get a good place, clean, neat, hygienic, basic promises met, and plus you get flexibility. But in student housing communities are very bad.
00:58:12
Speaker
It's so a structural difference, not really to do with Zolo's capability, but to do more with ah the audience you're dealing with. for a community to be built, um the audience ought to sort of connect with each other, should have a little steadier outlook to the life, oh should somehow be able to relate to that place ah per se. So for our co-living business, I wouldn't say community is a very big moat, because this is a transitionary audience. ah Very few people sort of come to us thinking I'll stay here five years.
00:58:52
Speaker
Yeah, yeah, yeah. true And jobs anyway, I don't know if people are even sticking to jobs or as far as RANSTAT service, 70% of the folks are changing their jobs within 16 months. At early career. So that because of its transitionary nature, so community by design sort of becomes a little difficult proposition. But for um Through housing business, community is a very big value prop. And we can see the difference also in terms of wherever we are operating. ah The differences are quite massive compared to- And how do you how do you do the community part? I mean, one is community is organic because they are in the same campus. right yeah Beyond that, what is it that you are doing to ah kind of enable it?
00:59:45
Speaker
So we are a catalyst. ah So I can't, as I said, I can't force a community. ah So there are some structural fundamental aspects of a community, always one there is us versus others. There is a common sense of identity. So I can't force a community on people. But if there are this fundamental structural elements available, we can really catalyze that.
01:00:10
Speaker
So what we do in student housing is catalyze that community. So we have a micro-cohort playbook, macro-cohort playbook. um What are these? Just can you zoom in a bit? So in micro-cohort playbook. So first of all, there's a platform, then comes playbook. So like I talked to you, talked about the app.
01:00:27
Speaker
where every student is some sense in some sense a player. So everything you do is like a game. If you are a player in a cricket tournament, so then you get x experiment amount of point. If you're audience also, you can go and do a QR code scan and get some audience points. ah and All these points, gems, XPs, they have their own meaning value, ah leaderboards, victories, quest leaderboards. We can do things very easily like IPL,
01:00:57
Speaker
inside the campus that tech allows us to do very nice Premier Leagues so you can sort of have players buy, sell, see dashboards. So you can do a lot of things in sight or ignite a competitive spirit, ignite a passion spirit. So in that micro cohort playbook, what I was talking about, oh we do a lot of these small, small things such as social causes, plantation, small things which a lot of people aren't interested, hieroglyphics, literary quizzes. So we enable all that very seamlessly because not a lot of times students have so much of an energy and bandwidth to sort of do all this.
01:01:37
Speaker
So there are some colleges which are very ah which have a vibrant community going in themselves. So there also, I think, if where we have gone, we have been able to take it up the notch. And in some way, there was no vibrant community we've been able to build a lot.
01:01:53
Speaker
especially around three things. ah One is sports. So with a lot of tournaments, a lot of but excitement, a lot of visibility. Two is ah health and mental wellness. And I think this is a very important piece in today's world.
01:02:10
Speaker
oh with with basic problems of Otikabra Makan being solved for everyone. Now we are all struggling for meaning. And I think it's true for you, true for me, true for big part of our generation ah that the first purpose which previous generation had, I'm saying first purpose, I'm not saying they were so wise to choose purposes. There was a first purpose of Otikabra Makan.
01:02:36
Speaker
ah for viewers who are not very comfortable within the basic food and amenities of housing. oh so So that sort of kept them sane. Like sometimes I think that if I had oh a challenge of just housing or food and shelter for my kids, right, if I come to work and somebody were to beat me with sticks, like literally beat me with sticks, yeah I will take it. I will take it so happily without complaining because I know this is what puts food on table for my family. And if I don't take this, they will not have food.
01:03:10
Speaker
ah And for my kids, I can like, I can like, die. So this is a very tiny sacrifice to make, to get beaten every day. oh But now that I know, but look, that's not a problem. They need to find a purpose.
01:03:25
Speaker
How are you ah doing this for a college student? like Are you helping them find their purpose through? No. That's a very tough one. So we are trying to solve for ah basic foundational things. Hoping that this will help them in finding their purpose or at least. Give me an example. bringing i putt so we have So we generally go to meditation clubs, yogas, sunbas. So there are hacks to work.
01:03:53
Speaker
There are hacks to wellness also. it's One is a philosophical mental alignment, which is from a purpose standpoint. That accentuates the problem of mental wellness, but that is something that is hard for us to solve. But what we can do is we can solve for more tactical and strategic elements.
01:04:12
Speaker
ah that if there are a lot of people regularly taking participation participation in meditation, if there are a lot of people who are regularly coming for morning yoga classes, that keeps you more stronger. It is not solving for the philosophical issue. These events, classes, tournaments, are they student-driven, like a student will create an event and then tell people, Hey, I've created this event. Or do you have like a community manager who is seeding the events and finding trainers for meditation? of the latter So we will take care of all the logistics.
01:04:51
Speaker
uh, students have to participate and for participation also, they have a lot of fun, like I said, gems and XPs, uh, which, uh, they get. And then those gems and XPs also have a lot of competitive claim that like I said, you have options of rating battles against each other. You can send your armies, uh, which can go and loot XPs from other people. And then there are portions, there are weapons. So there's a lot of strategy involved in winning the zo tribe game. So we call that app zo tribe. Okay.
01:05:20
Speaker
There are a lot of strategies involved in winning the Zotribe game, other than just participation. Participation is one of the key elements of a massing, but a massing doesn't mean protecting. So you have to use a lot of strategies to sort of protect that. Micro-cohorts. Micro-cohorts is like sports, tournaments, meditation. Sports we found under macro-cohort. Micro-cohort is hieroglyphics.
01:05:49
Speaker
oh ah let's say social plantations, okay always some specific movie screening, literary quizzes, and what it used to be clubs, colleges used to have these clubs. So that is, yeah, so that's the same cases. Look, we're not reinventing the wheel. I am not claiming that.
01:06:10
Speaker
We are catalyzing it via digitization and logistical support. oh So we are catalyzing it. Digitization is one of the pillars and another big pillar is logistical support because not necessarily every campus has enough number of folks who are willing to take the logistical assholes.
01:06:30
Speaker
Yeah. yeah true true it It doesn't sort of happen automatically. There is somebody who has to spend weeks and weeks for one thing to happen. oh And if you have enough bunch of those folks, great. But it's not true. And I can bet whatever we have now surveyed campuses, it's not true for 90% of the campuses.
01:06:51
Speaker
Well, it requires a very high level of motivation amongst students, dedication to passions, dedication to cause, not necessary, you get that everywhere. So are the pillars of community.
01:07:04
Speaker
and And let's zoom out a bit. So you one experiment you did ah was student housing. And then you have your core business of PG or co-living, which is anyway continuing. ah What else is also there, things which resulted from the experiments?
01:07:21
Speaker
So we then figured out that, look, going forward, we want to so we want to build very high quality assets. A build is a wrong word. We want to operate on very high quality assets. And high quality assets require very high investments, which is not available with single individuals. And real estate developers are not getting into the game because it's not their business to hold assets. Their business is to sell assets, residential especially.
01:07:49
Speaker
So we created another sort of vertical which helps real estate developers to build assets which will be used for coliving but eventually sold, not eventually, but sold to retail retail investors.
01:08:02
Speaker
So it became a very beautiful game. Like if let's say, and I think you are my typical client in some sense, somebody who is not very comfortable with owning a lot of real estate, because that person finds it hassled and doesn't know who to rent it out and all that noise. So for you, I will come and tell you that come, I have an asset which Zola will lease.
01:08:27
Speaker
And you don't need to worry about any kind of tenant, hassle, repairs, menders, nothing. You have a very good long-term security on rental. We have a short end service for you. oh and oh And for developer, it is basically the flat sold or apartment of studio sold. So everybody wins. You get to participate in a very nice ah residential real estate appreciation story, as well as a much higher rental than the market.
01:08:56
Speaker
Developer gets to sell. Zolo gets a high class asset. So that became a beautiful game is now growing very aggressively. ah So that worked out well where we got our second piece of supply strategy sorted. So this was our second supply strategy. How much of your supply comes from this?
01:09:14
Speaker
As of now, it's because it takes time to build two to three years to build all these. So today I would say it's a very small percentage, but if you roll the clocks just two years, one and a half year from here, it will be a fairly decent percentage because a lot of these assets will start coming live. Right. Because they are under construction today. You would be talking to developers when it's under construction. Yeah. Land level.
01:09:40
Speaker
Oh, at land level. So you would also do some sort of a recommended design architecturally to optimize it for coding. So we have a bunch of suite of services for developers. Design is one of them. And selling that to retail investors, a platform to sell is one of them.
01:10:01
Speaker
So how, what is the architecture and difference in the way the apartment complex is designed? If it is designed for these are, ah these are fungible apartments. So they can operate as Colavin. Let's say, let's take an example of one BHK that Zola will build for Zola is a wrong word, but we will recommend the design on.
01:10:19
Speaker
So till the time co-living operates, it has two rooms and a small kitchenette. If tomorrow, God forbid co-living is not viable at that location or not worthy, then you can just take out one room that will become a very large kitchen. So you have a very nice, beautiful 1BH scale, which is like a standard inventory. um So you remove one wall. That wall is a non-load bearing wall. So you remove that wall, which is removable.
Partnerships and Operations
01:10:45
Speaker
and lost but but and it becomes a 1BHK. Till the time cool living is happening, it is basically like a tow BH with a small cage with a nice pantry and dry kitchen. When you make it a 1BHK, it's a full fledged large family size kitchen where you can like as a family live.
01:11:07
Speaker
So so weve we we've sort of, because look, assets aren't forever. yeah Models can come and go. So we wanted to make sure that none of our investors ever feel that, oh shit, I made a mistake of buying a co-living asset. You're technically buying both co-living till co-living and when the way we see it, it will go forever.
01:11:30
Speaker
But you have to cover the risk for someone who is buying an asset. So these are fungible designs that we sort of recommend and build on. oh Or these are small studios which will be the future inventory. The way real estate is becoming inexpensive and expensive and expensive. I think 15 years down the line, majority of single couples, I mean single couples, no kids couples will be living oh in studios only because it won't make a lot of sense to take expensive houses. And I don't foresee so much of infrastructure getting built that you can stay 20 kilometers from the city or 40 kilometers from the city.
01:12:09
Speaker
So you will have to stay inside the city and the the space in the city is so limited that ah we will go down the path of studios. So either we make studios or fungible designs which can sort of act as any kind of inventory. okay okay ah What is in terms of experiments? I guess you also mentioned one of the day make the hotel business.
01:12:32
Speaker
overnight. Yeah, yeah, that was that that's that was like desperate opportunity. It worked out very well. We have two high end business hotels which do really well. One we have in Bombay and one we have in Bangalore, but that's not has become our mainstream business yet. ah Those are like pure hotels or are they like co-living in which some rooms are hotels?
01:13:00
Speaker
These are pure hotels, hotels and co-living is also okay in that, but their decor, their style, everything is done like hotel. But as I said, this is more opportunistic ah play that doesn't define Zolo, per se. They happen to be really doing really well. That's just a whole different thing. But one of the key pieces that we have launched in hospitality is the vacations, which is for resorts.
01:13:30
Speaker
oh So that started to pick up really well. We have three live and 15 more coming live in next 60 days. ah and This is like ah you rent the resort and then you rent it out further, that same model? like Management contracts. No, no, no. These are management contracts. Management contracts, okay. Because hospitality fundamentally operates on management contracts and and hospitality is not as predictable a business as a co-living is. Yes. So you really can't know that this year I'll get these many tourists.
01:14:03
Speaker
oh So in leisure hospitality, it's generally the standard model of operations for anyone is is ah management contracts or revenue share, you can call it whichever way makes more sense to people, you and the audience. oh And there we are seeing a very good uptick because country needs a good Airbnb manager.
01:14:26
Speaker
In globally, there are a lot of great ah businesses built on being an Airbnb manager or leisure hospitality manager. We have a lot of demand aggregators in the space. We have very few good managers.
01:14:39
Speaker
oh So our, what the gap that we are feeling there, like a tool, like we have an operating capability or a tech capability. So that's our key strength. So we have taken that key strength to this place. Demand comes via OTAs and via agents and multiple there are multiple channels for demand. So we're not claiming a demand power on this side, we are claiming a management power. And that's picking up really well and people are appreciating that there is a need for a great Airbnb manager of sorts. And that business is also picking up well as a mainstream business. And what kind of resorts are these? So ranging from and five rooms for five to 50, we have all kinds. Okay. open And do you also manage their listings and the whole process or just the operation? Everything. running the don Okay. So we are in a way like a supply aggregators now.
01:15:38
Speaker
in a way like Yeah, if that makes sense. yes so I mean, I call it managers, because I will manage the entire space, including demand. oh But if supply aggregation makes more sense, I think it's just semantics in that sense. Interesting, interesting.
01:15:56
Speaker
This in itself is a large opportunity, right? I think there are a couple of unicorns in this space in Europe and who do this, and u okay yes like managing Airbnb properties. ah ah Typically when you go abroad, the the owner has no role in it. ah There is some professional manager who's managing the property, even if it's a yeah single room, even for a single room that is also typically managed.
01:16:21
Speaker
Yes, yes. So it is a fairly large opportunity. And we are also finding it as quite a welcoming market. oh If you can pull off that much of hops. It's not an easy business, but a very large opportunity. How do you scale operational excellence? Because you know, this is a
01:16:47
Speaker
I mean, you know, the scope of doing something wrong and is not really the like safe. If you're a manufacturer, you always have a quality check process later on to make sure nothing wrong is going on to your customer. But this is a different kind of ops where if something is going wrong, you will immediately get escalation.
01:17:06
Speaker
and So just tell me about your learnings of building strong operational capability. How has how have you built that capability over the years? you know ah What metrics do you track for this? What is the way in which you've created the org chart to enable operational excellence? So I will change the lens a little bit of looking at it. oh One of the key things here is hiring and training.
01:17:36
Speaker
Where do you hire? Who do you hire? How do you hire? How do you train them? How do you groom them? Then incentive structures. Then your ability to monitor, measure, closing the loop with the customer as far as feedback is concerned. That's where tech plays a very big role. oh Abstracting your SOPs.
01:18:00
Speaker
in into tech because if you are sort of running from one SOP to another on paper or on something, it doesn't work. Abstracting the SOPs, using a lot of data and analytics to find patterns where things are going wrong, how things are going wrong. But but what you said is it remains true that, look, I cannot immediately control what went to the customer.
01:18:24
Speaker
But I can sort of make sure my patterns are in line through the use of data and a lot of analytics and a lot of processes and real-time monitoring of those processes. like meha We have a sort of monitoring center for onboardings. So every day there are people monitoring 500 onboarding pictures. That room is ready, room is ready, room is ready.
01:18:50
Speaker
Onboarding means when a customer is taking his room. So you abstractize a lot of your SOPs and real-time monitoring via tech.
01:19:03
Speaker
oh convert it into data that you can sort of find patterns, trends, errors, issues, close the loop with the customer in terms of feedback, then iterate, repeat. So it is obviously a relatively, it is not an easy thing to build.
01:19:21
Speaker
That's the good and bad of it. The bad is that it takes time. The good is that once built, you can't just disrupt. Like tomorrow, somebody finds another organization with some $50 million, dollars which did happen to one or one of the competitors got some $150 million. dollars And then it that doesn't mean that they can come and just take a away business.
01:19:46
Speaker
It just doesn't work that way. it's sit's so ah The pro and the con is the same. The pro is, or the con is that it's a tough thing to build. The con is once built, it's really hard to replicate. The nuance and the depth of replication is so high that it's really, really hard to replicate. Okay. ah Give me examples of the analytics part of it. You said analytics can ah help here. will Give me an example. like oh For example, you you have NPS analytics. Which customer cohort is going lower? Which is going higher? Why? What are the key parameters? Which properties have taken a hit on NPS? Is it because of staff or is it because of some infrastructure issues?
01:20:31
Speaker
which part of the journey like we take feedback at the time of onboarding at the time of when we do housekeeping then also there is a feedback triggered when there's R&M tickets. So all this information sort of helps you um understand where things are going wrong and how to fix them in the fastest possible way.
01:20:49
Speaker
I mean, it's a people problem or a process problem or an infrastructure problem. Yeah, will do yeah at a very highest level. Yes. I mean, there is a good amount of depth in that also. It helps in forecasting. Where is this month going to land? Why is this month going to land? ah So so it sort of helps you get a grip on the business in various shapes and forms. ah We are not a big data company. So if it's not that we are dealing with Billions of rows in our job is to find cohorts. Rather we are in some in the small data company that you have to find those small places oh which are going wrong for the customer and go and fix those small places. Because experiences are about small things, ah not about big things. Big things a lot of people can get right.
01:21:44
Speaker
Small things are where rubber meets the road in terms of, or, yeah, true. venness approach from boys ah This abstraction of SOPs into like a digitized workflow, did you lead that personally or like, ah how did you build that? That sounds like a real moat. For the most part, personally.
01:22:07
Speaker
ah For reasons which are not to do with that, it's a real mode. Reasons to do with that. We took a very counterintuitive call a couple of years back. oh we no We removed product from our organization.
01:22:25
Speaker
okay product team What was happening was basically that business will talk to product, product will talk to tech, tech will talk to product, product will talk to business, business talk to product. And there were so many translations, so many interpretations of the same thing.
01:22:41
Speaker
that it was genuinely getting confusing and annoying for all parties involved product I was feeling bad about it look I can't make a big decision or I can't change because business tends to be to me business saying look dude I tell 10 features this guy's only 4 can happen Tech is saying, and unless you give me a PRD, I'm not moving. So engineers are not very happy because they are not really getting a challenge. They're getting PRDs. So we took a bold call of saying, let business directly deal with tech. So let all the engineers directly go
01:23:15
Speaker
face the problem statement. So you're smart people. Most of the engineers, computer science, that especially who we hire, we believe are very smart people and they enjoy good problems. oh Business also started ah understanding and appreciating the challenges that tech has. They have a certain sprint, a certain schedule. You can't just wake up one day and say, but tomorrow give me this.
01:23:38
Speaker
ah So the conversations became more meaningful, solutions became more meaningful. In that sense, till that rhythm became between business and tech, I had to play a very sort of bridging role. So in that process, ah while playing that bridging role, a lot of these things I had to personally oversee. Interesting. What are some of your leadership principles? and What is the headcount you managed today?
01:24:08
Speaker
like over a long time. We have, I mean, a property and a non-property, we have 2,500 people roughly.
Cultural Development and Leadership
01:24:16
Speaker
Okay. And what's your ARR today? Roughly 400 colors. Wow. So, you know, I'd love to learn your leadership principles. How do you manage such a large, like 2,500 people who mix a blue color, gray color, white colors,
01:24:37
Speaker
like How do you do that? In the screen, although it might be reversed, there is 16 principles of ZOLO. Yes, I can see that. That yellow. I'm not sure if it's yeah readable or it's reversed. I can see the text in it, but I can see 16 principles of ZOLO. Yes. We have a cultural playbook that we give to every employee and we expect them to follow that.
01:25:01
Speaker
In that also, obviously, there are some which are more crucial and some which are not. oh But culture is a very ever-changing item. Honestly, I'll rate myself 3 out of 10 as far as culture is concerned because it's such a holy grail item oh that once figured out, then skies or anything is the limit if you if you know how to build an applicable culture.
01:25:27
Speaker
ah But we do try or we have taken some steps to build a sort of a culture which is scalable, which is understandable by people, where they know what is expected of them, oh or how to make decisions if no one's watching, what is it ah that will be awarded later or penalized later, how to sort of go about it.
01:25:52
Speaker
And sometimes I have also taken a lot of tough decisions when things are not going, or let's say some leader is not. oh and One leader I feel so bad about, brilliant person, i I love the person. But we had a very big cultural conflict on how to how to see Zolo's culture. And I had to sort of, we had to part ways.
01:26:17
Speaker
oh so So sometimes it would be tough calls also for culture. oh and And that's, I think, this alone is a five hour, two hour podcast for some other time, just how to build culture and the challenges of culture, and the nuances and where it breaks and where it really oh But yeah, it's it's really about displaying, rewarding, because what you reward becomes the culture displaying, rewarding, and sometimes holding it dear.
01:26:52
Speaker
oh So much so that you have to take hard calls. oh So that that's, I think is a very succinct one minute summary I can give. But as I said, if someday we get time again in life, let's do it to our podcast. just to track and What does your org chart look like? how you Who reports directly to you? Is it functional? Is it like business unit?
01:27:21
Speaker
Kids, so so ah CEO, CFO, CTO, CBO, these are the ones who report to me. CBO is like head of revenue, you know like sales. but For us, CBO is our other founders, neha which is more special projects and crisis management.
01:27:43
Speaker
Okay. It's a founder, so it doesn't matter what's the title. so So SNAI is primarily for wherever we need a POC or wherever we need a crisis to be managed. So she works on that. And business heads or business verticals report to COO as a P&L function. Okay. So COO manages the P&L. Business heads are what, like city-wise or like the say hotel has a separate business head or like So, tail will have a separate business head. So, different different verticals will have a separate business head. So, the PG business on its own has one single head. Like that head would be the head handling the maximum. Head of co-living, yes. Yes, he handles myself. Head of co-living, head of student housing. And and then there are sub heads of each vertical. So, then it goes there. And how do you find these heads? ah Do you train them in-house or do you hire from outside or like what's the approach to?
01:28:41
Speaker
We've done both, but our lesson is that training in-house is the best methodology. oh Because at some point in business journeys, IQ stops mattering. Or rather, let's put it that way, that the poll that you will select people from, they all have good IQ.
01:29:04
Speaker
Yeah, yeah, yeah, yeah. True, true, true. So then it stops mattering. I wouldn't say IQ is meaningless. i Intellect has a very big... It's not a differentiator. It's not a differentiator. What really starts differentiating a person's performance is so whether they align to your working style, whether they believe oh in the ah modus operandi that you believe in,
01:29:33
Speaker
whether they hold certain behavior traits as sacrosanct as you hold whether they are hurt by some kind of mistakes like you are hurt by So the modus operandi becomes a very, very big factor and that relation to modus operandi becomes a very big factor in someone's success. And we also see, right, somebody was a rockstar in organization X and organization Y, like field drastically went to organization C again, became a rockstar. The guy is the same. yard It's not a a big difference.
01:30:11
Speaker
Alignment to the working styles methodology, ah some people like a lot of creative freedom, some people would rather be okay with less creative freedom but more bounded approach so that they don't feel uncomfortable that what do I really do.
01:30:28
Speaker
So different people have a very different way of thinking about life, operating. And what we have finally concluded is that it's way better to drone people in-house than to directly get very senior role from outside. oh Not that people outside are not smart and only Zolo are smart people. Maybe they are way smarter than what Zolo has.
01:30:52
Speaker
ah But it's just that it's a more safer approach in terms of getting a misfit.
Crisis Management and CEO Focus
01:30:58
Speaker
And misfit at a very senior level can really hurt you, like really, really. Yeah. Yeah. yeah It comes into like a yard story headline, CBO culture. That's the tiniest of the head they are. PR hit is the tiniest of the head. The world forgets it. And I mean, thanks to today's over flux of information to the world, nobody remembers these things beyond five minutes.
01:31:22
Speaker
PR hit is the least amount of it. Your internal systems, processes, teams, so many things get destabilized. oh that you you It's not a very trivial loss. To rebuild that leader's position, we we can see it's a lot of months worth of exercise all over again.
01:31:44
Speaker
I found it interesting that ah you have like crisis management as a separate function which your co-founder is responsible for. um Why is that? Is it that there are a lot of like this sector is prone to crisis? Is that the reason that you... No, there's nothing to a sectoral crisis.
01:32:05
Speaker
When I say crisis, I don't mean crisis, which is more customer focused, more internal crisis. In the sense that you have a, it's not even a crisis, we call it crisis. Let's say like the first word I use defines more of a rule crisis is like second, I said special projects first. yeah so Special projects defines more of a rule. And sometimes crisis is a special project.
01:32:31
Speaker
Special projects defines more of a role that let's say you want to like student housing or you want to do something new or you want to think about a new vertical or you want to do a personal excel excellence piece on something ah because line and design is not a very common skill available in one person. ah Line and design, what is what does that mean?
01:32:57
Speaker
Like people who are good line managers where they can manage your daily ops, daily staff very well, with this subject which is already designed. Yeah, which is already designed. It's a very different sort of DNA versus somebody. If you throw them and say you designed this.
01:33:11
Speaker
Yeah. Okay. That zero high is more design. hello So and she, she's sort of supposed to do a lot of special projects and okay or design and not the creative design. This is a process design for the most part. Zero to one, basically for problems. Zero to one, one to 10. In some cases it's 10 to a hundred. Also like ladies are two process, which is struggling, which needs a deep dive.
01:33:35
Speaker
So to that that is in some sense crisis, customer crisis. Problem solving basically. I understood. but but So what do you personally track? What metrics? What information? you know what what what ah How do you invest your time? You have limited number of hours that you can give. You have to judiciously decide where to allocate your time. How do you do that?
01:34:00
Speaker
So answer varies every month, every quarter, every year. ah There is a book by Ben Horowitz, Hard Things About Hard Things, oh where he says, as a CEO, you are the only guy who has the complete picture. oh So you ought to be really wise to know what exactly will work for my organization when and how. And there are no best answers which are generic.
01:34:30
Speaker
There are no best answers, generic best answers. If somebody comes and says that this is how an organization is built or if there was a book that you could follow, literally almost everyone would have a billion dollar startup. Yeah, that's true. So there are no best answers for your organization at this point of time. There are best answers. The thing is there are 100 best answers.
01:34:55
Speaker
and Your job is to know which is the best answer which will work today. For my context, my scale, my issues, my org structure, my customer offering, my bank balance, my investor confidence, my future capital layout, my shareholders. so so that Since it's such a multi-factorial equation,
01:35:22
Speaker
Answer changes. Answer changes a lot. Some months I have spent so much time on just design, visual design. Some months I have spent a good amount of time on product, just hardcore tech product, ah which when I say visual design, including the physical visual design and digital visual design.
01:35:43
Speaker
in In some months, I have spent a lot of time just building processes, manuals, SOPs. Some months I have spent just doing reviews and reviews and reviews. So answer is not a very steady answer and I have lived time with steady answers as well and oh I realized that not a great way to go with.
01:36:12
Speaker
ah You need to have a cadence of things. So there is certain cadence of some reviews, but that's 20% of my time, 20-30% of my time. Because without cadence, the organization goes for a tizzy. Right. So there is a cadence of reviews, P&L reviews, demand reviews, ops reviews. There is a cadence of reviews because without cadence, like what you don't measure, what you don't review, it never gets improved and never gets moved. Yes. Yes. Yes. But as 30% of my time, 70 sort of varies quite aggressively.
01:36:46
Speaker
ah What does Zolo need right now? You know, things so are on your plate right now. Right now, I'm trying to bring a certain momentum on different different ah how do you say initiatives that we have. Some are moving faster, some are moving slow.
01:37:08
Speaker
ah So trying to bring a certain momentum, bring in a more smoother org design, the org design that I told you is a very recent org design. Earlier, different, different verticals were reporting to different, different leaders, and there was a lot of noise, etc.
01:37:26
Speaker
So making sure that this new org design, which is much cleaner, much easier for anyone to absorb, like in a matter of minutes in some sense, you got it. oh So I had to stabilize that so because with the new org design, there are new set of processes.
01:37:46
Speaker
that ought to come into play, new way of looking at data reviews that ought to come into play. So my current priorities, this and second most priorities, profitability. Actually, first is profitability. This is means to an end and end is
Financial Strategies and Future Goals
01:38:02
Speaker
profitability. Right, right, right, right. We were how from last year.
01:38:07
Speaker
We actually became profitable last year. We spent eight months out of 12 profitable. Then there was a change, like I told you, like recently we were classified into hospitality, a certain part of business at least. oh Which part, like the co-living business or what? Yeah, co-living business. So which means that you need to increase your prices by 18% or what is that? No, roughly 7%.
01:38:36
Speaker
7 to 12 percent. yeah and We've absorbed some hit and we've passed on some hit to the customers. So 12 percent was a total ask. We've absorbed some hit and we've passed on some hit. So now that you've absorbed some hit, that hit has to be covered by a higher occupancy, some sort of pricing changes, etc, etc.
01:38:56
Speaker
oh So that brought us again to red. Now with IFCOD's kind by next month or latest but next month we'll back to green. oh so Before this, eg section had no gsd in it ah the residential leasing part had no GST, services part had GST, now all combined as GST.
01:39:19
Speaker
no So your contract would be split. Like if you're charging some 10,000 of that, some part would be rental, which is leasing, and some part would be services. And the services part would have a tax on it.
01:39:31
Speaker
ah In that case, also department is still okay. So that's a very nuanced conversation. I think we can spare the audience from getting too technical about it ah and doesn't have any abstract meaning into it. oh But they can probably someday out of curiosity discuss offline.
01:39:52
Speaker
Yeah, so sure, sure, sure. I understand. I understand. Okay. what's the What's the goal that you're chasing? So today you said you have 400 karori, 2500 dead count. I think you said 16,000 people are living in spaces. 60,000. 60,000. Wow. Okay. So what's the goal that you're chasing? Do you have some milestone?
01:40:15
Speaker
so
01:40:18
Speaker
Goals keep changing air quite honestly. So we have, I have a very high clarity on my five-year play. I honestly don't know. What is that? hope You can share that. what What's the five-year play? So in five years, we would have more or less be known for the vision with which we started that any living space is best managed by Zorro in various shapes and formats.
01:40:47
Speaker
Six months I honestly don't know. yeah it's I mean, ideally I should have been there by now. Like when I think about what I had kept my goals as, I should have been there by now.
01:41:00
Speaker
But with this dizzy of macro changing so much, oh it's gotten them really hard to predict the macro. oh Some months you feel like, oh, everybody's coming back. And then suddenly, no, no, we're not coming back. and So at some places, so it's it's so given the macro, it's really hard to say six months, but five years.
Urban Development in India
01:41:24
Speaker
macaron joules taxation or are you also talking of demand or like urbanization, return to office, okay very unpredictable right now. ah Although taxation is sorted in some sense, but very unpredictable right now. So I know all of this will become sorted in a couple of months.
01:41:49
Speaker
oh ah So, I think the return to office question is answered, right? Like most companies are doing. But IT services is not yet. IT services still has a very limited tendency. Because IT services, people are still taking a hard line that if you call us back, we are not coming back.
01:42:10
Speaker
um That struggle is still going on. Okay. okay Mostly IT services. now Majority of rest of the world, whether it's BFSI, IT product, startups, and everything is sort of back to office. IT services is still somewhere in the middle. oh And it's become more of a financial issue than work from office issue.
01:42:33
Speaker
because big city living is expensive and people are like, you want to call us, we would rather have higher packages or we are living a life well here. I don't know exactly to be honest, but these are what I've heard from our customers. oh And so that's one segment which is yet to sort of up well which the signs are very positive. So most of the companies have sort of, you would have heard that has made it mandatory if you want appraisals or promotions. you Yes. Yes. Yes. Yes. Yes. So all the signs are positive. So it's just matter of few months or quarters at best, I guess. um But, but yeah, again, there's uncertainty. Maybe it happens, maybe it doesn't happen. Do you see yeah tier two also contributing or you think tier two is not really a relevant market for solar?
01:43:22
Speaker
No, because it's an urban migration phenomenon. TO2 is already a great but vertical for... So Zolo doesn't have one customer anymore. So it's hard to sort of speak of Zolo as one customer.
01:43:36
Speaker
so far gold living Student housing is actually a lot of tier two. We are present in Trichy and Karoor. A lot of South folks won't have heard of these names. Forget about this guy. So we're present in different, different areas in student housing. And Zevacations fundamentally takes us to a lot of touristy spots. So there is a play for Zolo at a lot of places.
01:44:06
Speaker
oh He is an urban migration. okay okay yeah you know I remember reading somewhere or hearing on a podcast that India needs about 15 more urban centers ah to really hit that kind of ambitious goals that India has to be a 5 trillion economy and all that. What is your take on it? like What do you see very broad level, ah macroeconomic level, what will urbanization look like in India? Will it be concentrated in these cities? Will there be new urban centers coming up? or
01:44:39
Speaker
There have to be new urban centers here. These cities are already buckling under the pressure of sort of population. I don't see any way oh that these cities can take that much load for us to get to our goals in terms of whether you call it GDP or growth or prosperity, whichever way you look at it.
01:45:06
Speaker
there has to be a lot more urban centers which have to be developed. And I don't i am not a subscriber to philosophy of too much of rural-led development. Not that I'm trying to trivialize rural India. It's just that you need to concentrate oh ah population or people or brains, ah you need to make it easy for them to collaborate, work together, create value. And that technically is what urbanization is. If you look at South Korea, Seoul contributes to 90% of GDP of South Korea. Yeah, Japan also so similar. Yeah.
01:45:47
Speaker
ah cities contribute. So you you got to concentrate because look, if you and I really want to build something meaningful, we got to like meet often. We can manage remote on and off as sort of an option, but doesn't really and provide the best form of engagement. So there will have to be concentration of humanity.
01:46:14
Speaker
ah where there is more collaboration, more facilities, like simple things like hospitals. If you want, you can't build tertiary hospitals in each village. And if I'm thinking about ah my kid, I would want to live in a place where there's a tertiary care hospital, yeah schooling.
01:46:34
Speaker
Some people feel that schooling matters. I'm not one of them, but some people feel schooling matters. and so i would What are the upcoming urban locations? Have you seen any trends? Ahmedabad is coming up well, Indore is coming up well. oh There is i mean some buzz happening on the Chandigarh side as well. oh But not ah close to what one would imagine as per reports. That's my take. It was a real pleasure.
01:47:07
Speaker
Indeed, it was a real pleasure, Akshay. 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.