Transcript
Speaker: Hi, this is Sunny Singh. I'm the founder of Roundglass and I'm happy and very glad to be on the show with Akshay.
Speaker: Did you know that Language Translation Services is a $56 billion industry globally? You may be wondering why I am sharing this data with you. Stay tuned and you will understand. The healthcare industry in the US is an $800 billion industry.
Speaker: And it comprises several stakeholders who have to work together starting from the government, which partly funds healthcare to employers who provide medical insurance to insurance companies, to hospitals and clinics. And each of these stakeholders speak their own language and record data in their own formats and structures. Imagine the market opportunity in translating the data and information flow in this ecosystem. This is exactly the opportunity that edFX capitalized on.
Speaker: The large market opportunity combined with the excellence in executing is what eventually led to an acquisition of edifex by private equity at a valuation of more than a billion dollars. In this episode, your host Akshay Tath talks with Sunny Singh who founded edifex and spent two and a half decades in scaling it before it was acquired. Sunny is currently the founder of Roundglass, which is a combination of social enterprise and a for -profit wellness business.
Speaker: Stay tuned for this amazing conversation and subscribe to the Founder Thesis Podcast and any audio streaming app to hear veteran founders talk about building billion -dollar businesses.
Speaker: And the reason was not because I was trying to take something in my career, it's because there's only engineering I could get to stay in Delhi, where my hometown was. So I took textiles and then my first master's was in industrial engineering, I wanted to do robotics. And as I was doing industrial engineering and management, after a year, I realized that's not what I wanted to do. And I started in computer science courses and I started enjoying them.
Speaker: And so I ended up doing a second master along with my first one. And when I finished the first, then I did my second. So it took me three years and I did both my masters. But I ended up doing computer science. But the best part is that I am the worst computer holder in the world, I think.
Speaker: I've never written a single line of code for my companies. And because I just know how to code, I don't know how to code and I've got a master's in computer science. But yeah, so I have those degrees, but I have not used anything in those degrees that I can remember in my career. Or at least if I did, I miserably failed at it. So you were working at Microsoft before you started up. How did you tell me that journey to Microsoft?
Speaker: Yeah. So I was, um, I did one job in Montana, then I did another job in Seattle, I moved to Seattle in 93.
Speaker: Yeah, I did. I was in supply chain management with the company called Expeditors. And a lot of EDI, a lot of logistic stuff. And at that point, EDI is an electronic paradigm of exchanging information. And so sending like purchase orders, invoices, and sending them to paper of packs, you send them electronically. And so there are standards by which you send this information back and forth.
Speaker: worldwide, whether it's the US, whatever, and then you subscribe to those standards and therefore the other person can read what you have sent.
Speaker: So anyways, and then my second job, I decided that I was going to become an entrepreneur because I was not thriving in my jobs. And after a lot of thinking, I realized that what I'm going to be is an entrepreneur. So when I decided to be an entrepreneur, I still wasn't sure what I wanted to do as an entrepreneur.
Speaker: And so a call came from from Microsoft, a friend of mine saying, hey, you know, you have an expertise in technologies like EDI, logistics, supply chain, come and help me out. And at first I told him that, look, I'm going to start something. So it's not a good idea for me to come in and work for you because I'm going to leave in a year or so. And he said, don't think about it.
Speaker: and let's start chatting again. And then I thought about it, it's gonna take me a year, year and a half to figure out what I wanted to do. So let me go to this rule. So I called him, I said, if being with you in years, then I'll be happy to come over. And I did, and I said it for a year and a half, and by the time I figured out what I wanted to do, and then embarked upon my first company.
Speaker: You had the green card by the time you decided. Yes. My first job, I got my green card. It took me about, I think, three years. Two and a half, maybe less. Somewhere about two, two, two and a half years and I got my big card. Got it. So tell me that, you know, like what was the idea which you wanted to execute? So the intent was, you know, I was a pretty good student of the industry. I knew my industry quite well.
Speaker: but I had never managed teams or businesses or P &Ls. So I was not a business focused guy, but I was a good student of my industry. And so after dabbing many ideas as to what I should do, I said, look, I should do something that is, that aligns with my competency. And my competency is, is these domain areas of electronic data exchange, electronic solutions, electronic commerce, supply, automated supply chains, et cetera.
Speaker: So we build a tool which allows you to document how these transactions are going to be transacted, going to be sent back and forth, you know, where does very much piece of information go. So you document and you send the document to the other side and say, look, this is how I'm going to send you the information so you know how to read it. And then this is how I'll receive the acknowledgement or information back from me. And this is how it should be compiled.
Speaker: And then, of course, we build a processing engine around, so how you define the information, when you get the information, how you process the information, see that it's aligned with your documentation that you have done. So we build both the documentation tool first and then the engine to read the data. So it's a data processing engine. And then the third, we put a management layer on top to be able to manage and track and monitor everything that was going on.
Speaker: So the sum total of that was the first set of products we built and we did well. Give me an example of what would be the use case for this.
Speaker: So let's say a company, let's say a health plan like Blue Cross Blue Shield of California or Cigna or Aetna, they tell the providers when you send me claims for reimbursement, because you're gonna send me claim, I'm gonna reimburse you, the claim should be in this format. The claim number should be here, the claim amount should be here, the claim date should be here, the episode should be here, all the related information should be in these various places that you send me the electronic feed.
Speaker: And when I receive it, then I have the engine to process it because I know what the feature looked like to process it. And if it's 100 % correct, then I consume it and operate my backend systems. If it's not, I'm going to reject it and say you have to resend it, but the haze was strong.
Speaker: And similarly, when you have to sell payment information that the health plan, the signal sends to its provider and saying, I'm going to send you the payment confirmation that I have sent you this payment. And this payment is for this claim. This is what you ask for. This is what I'm paying. Here's the delta of what I'm not paying. Why am I not paying? So all of that goes in certain places in the electronic feed.
Speaker: And so we did, you know, so there were many such documents between claims and claim payments and enrollments and clinical records. There's a lot of information and documents. Can they push the documents to get exchanged? So we subscribed, prescribed and subscribed to all of those docs, the formats, and that's how we enabled companies in the healthcare system to do electronic exchange of information. Because you can't randomly send any information to anybody and say, hey, go figure it out.
Speaker: And this data was streaming over the internet. Yeah, that's right. I guess today, this field of EDI, I don't think it is something which people talk about today. I guess it's kind of got replaced by, let's say, like an API or a Google Form even could also be something which... But this was like a precursor to what today happens through API calls.
Speaker: No, that's not correct because an API is a restrictive sort of information you'll send for an app to consume. And the amount of information that's exchanged in these documents and thereby the dozens of different types of documents that are exchanged, it's not easy to define an API and therefore, and also use different systems for different people, different claims management system.
Speaker: they can have different benefits system, the enrollment systems. Each of them will have to prescribe to an API that is very clean and straightforward, right? So that many to many, that I'm using many system -wise, I'm using many, or the industry is many to many, and how does each of them define an API that means the same thing? So the only way to do it is by prescribing standards, that this is how you exchange the information.
Speaker: And even a lot of the APIs are standardized. Think of a document standard on purchase orders or claims or payments as being an API, but universally accepted. That means that if you send me information in this format, I'll be able to consume it. And if I send you information in this format, you'll be able to consume it.
Speaker: So it's universifying the API that is maintained and published by a third party, but not by an individual vendor. Because standards are prescribed by consortiums and associations, they all contribute to this. So Bluetooth is a standard, for example. AI will eventually publish some standards, I'm sure.
Speaker: So EDI and XML and other standards they have, they work by consortium and association to prescribe. This is how information be exchanged within that industry.
Speaker: So you created the standard for the healthcare industry? No, we subscribe to it. We contribute to it. People used to go there and sit in meetings and help cross them as part of the collaborative effort. And then you of course supported it in our products. So you were like an implementation partner for healthcare companies who want to do electronic exchange of data.
Speaker: We were a products company. We built a product, we gave them the product, which was a gateway that would take all incoming information, process it correctly, and feed it into the incoming, into the backend systems, take the information from the backend systems, massage it, clean it up, and then send it out to all the business partners. So we had a gateway that sat at the edge of the enterprise.
Speaker: Got it, got it. And their IT teams would do the integration with their backend, like the IT teams of these companies. That's right. Got it, got it. So, I've understood the idea. Now, tell me about the journey of taking this idea to reality. You know, that zero to one journey. Like, did you need to raise funds before you started it? How did you get your first customer? How did you get your first team member? Like, you know, just go through that journey.
Speaker: Yeah, so the first is, I think, the whole journey of Firefox is a bit of an anomaly. We don't have any investors, so it was very self -funded as a company. We struggled quite a bit a few years into the company. I think it was 1999, 2000.
Speaker: we were on the verge of bankruptcy. So we had lost a customer who had lost their funding and they were responsible for 70 % of our revenues. And then we had... Before we come to this, can you tell me how you reached here? Like 96 you started, how did you get your first customer? And did you build the product on your own or did you have a team?
Speaker: Yeah, so the way the product was built was I drew upon some, you know, friends and my network and, and, and see if they want to build this product for equity. And I was able to get in a bunch of people who were able to do that and we worked and build the first product.
Speaker: which was all built by people working evenings and weekends for equity. And then once we launched the product, we started building an in -house team because we had to enhance the product, support the product. And we had to, of course, we had to build the sales team, the growth team, the marketing team to sell the product. So it was, how did you get your first sale?
Speaker: I'm a post -sale host to my previous boss, which was my first company. I worked for Expeditors. And they were before Microsoft. So Microsoft also bought the product. But I went to him and said, hey, I bought this product ready. It's a useful product. We always thought about leveraging something like this and really buy it. He said, if you give me this three or four or five features, I'll buy 10 licenses.
Speaker: So there was our first customer and then Microsoft came in another couple of years on the road. Um, and even the first company that worked for Montana and became a customer. So all three of them, the three companies that worked for became customers over time, but that's how we got a first customer. And how did you price it? Like you're saying people had to buy X number of licenses. Is it like one license is for one user? Yeah, that's right. They bought the number of each license for a user. And then they will buy X number of seats or X number of users.
Speaker: Um.
Speaker: Why do user -based pricing? From what I have understood about the product, it is an automation of exchanging data between two different organizations through a standardized format. Even one single user would be good enough, like a company would just need to buy one license, and that one user can... It's just like autopilot, right? Once you've set it up, then the information just starts flowing.
Speaker: Yeah, see, it's no, it's companies have teams that help define that, reference these standards. The engine, of course, is by server, how many servers you need to process all the information you. So, so there are people who need more licenses than people bought 10, 20, 30, 40 licenses because there's a team working on different standards. The bigger the companies, the more people they have, the more information, the more business partners, supply chain partners they have. So that became
Speaker: So the product defines the documentation product. The engine that processes the transactions, they need servers. So if they have one server and it taps out, then they need another server. They need a production and a staging server and a QA server. So we sell many server licenses of that. So no, we sold a lot of licenses of the product.
Speaker: So each machine where the product is installed is one license. Like, as you said, there were multiple servers where they would install. That's right. So if you're processing the transaction, the server, but if you're using it on a desktop is for each user, for the desktop user license. Got it. And you called it ADFX. So that EDI that stands for electronic data interchange, I guess. That's right. EDI is electronic data interchange.
Speaker: Got it. So yeah, coming to 1999. So you had what kind of revenue were you doing when you lost that one big customer?
Speaker: So what happened was we had, I think it was 1999 timeframe. So this customer lost 70 % of the funding. And so they were, we lost our major customer, which was maybe almost 80 % of our revenues. And they lost entire funding, I think. So they were scrambling or minimize the funding and we lost 70, 80 % of our revenues.
Speaker: And then we had a sales pipeline and sales leader, but the sales pipeline was not clean. It had accounts which we never realized into a sale. And so that became a double whammy. And so we said, what do we do? We have 125 plus people in the Eastern Europe. We had all these overhead sales are not coming in, revenues are burning down.
Speaker: And I signed my company on my credit cards, right? So the funding came through my, you know, I used 15, 20 credit cards, a whole bunch of them and I had some consulting money and that's how I got everything started. So cash was very important for us.
Speaker: And when that happened, then you had to downsize. And we downsized to about 10 plus people here in the US and another 15 years in Europe. And we had to rejig and re -organize. 125 became 25. Wow. That must have been a pretty tough experience.
Speaker: Yeah, it was, and then we started racking up some debt and whatnot. So, you know, I was on a business guy, so I didn't know how to run a business well. And so here we were, you know, we had stopped paying our landlord, we had stopped paying taxes because of the money. We thought, you know, we'll pay it later. Because we always thought, you know, optimus that the CS will pick up and we'll be able to pay everything. And we started including vendor debt. Our payroll was delayed. The worst, the worst period was by two.
Speaker: two months. And so we had all of these debt accumulating. And then we were pretty much on the verge of bankruptcy in 2000 and change. And then 9 -11 happened in 2001. So it was icing on the cake. It's like, what else could go wrong? And then 9 -11 happened.
Speaker: Like, how did you come out of this? And this must have been a pretty stressful time for you personally also, right? Like C plus nights and all. Yeah. So it was, it was, it was pretty tough. Um, you know, first I didn't have any experience running a business, so I had no idea how to get out of this home careless mess.
Speaker: But at that time, I think, you know, just like when I saw the company, I did some soul searching, some deep soul searching, and I said, look, if I've did three choices, what do I do? I can either shut the company down and everybody is telling me shut the company down, go work at another company, go to work at Microsoft, and this and that. Or I could declare bankruptcy and resell the company, or I could figure out how to save the company and just plug along.
Speaker: And at that time we decided that if we have one more day to live and we had to hope to survive one more day, then why don't we just focus on that one more day? And then we'd make the decision of one of these three things tomorrow. And that one day, one day became weeks and months and years and we didn't declare bankruptcy, we didn't shut the company down.
Speaker: And we kind of hunkered down to see what our core focus was, became very communicated to our team about all money's coming in, what's happening, what's not happening. We focused on our core product and so we really knew and we became very, very targeted, very laser focused.
Speaker: And then it took us, I think, almost 2005, 2006. By the time we paid off all our debt, paid the IRS off all the money, all them, we paid the landlord, we paid all the vendors, we paid all our associates and employees, gave them extra stock options. And by 2005, 2006, we came out of it where we started kind of getting out of the woodworks and becoming profitable.
Speaker: What did you feel were the things you did wrong because of which you landed in that kind of a situation? I think number one, decision making was a bit slow. And when you saw that there was a light at the other tunnel, you should know seeing the light is there, there's some out over there, that's the train. And so we didn't make decisions fast enough that look, we should cut costs, we should cut people, we should be more intelligent about our revenues and sales pipeline. And that was just a lack of business acumen.
Speaker: and a lack of awareness and foresight about how businesses work. So I think that was the primary reason. There was no other reason. There's nothing else we could have done instead of being a bit more decisive and aggressive in our decision making and being more realistic in our revenue and projections. I think that was a major reason. Was it that you thought of yourself as the product guy and did not go that hands -on into the business part of it?
Speaker: No, I was, I was very hands on and I wasn't the business side of things. I just didn't write any code. They did everything, but writing code, I, I did all the sales and marketing and support. Um, I defined the product, but didn't code the product. So I did a lot. I was involved in a lot, but as you know, things would have with that, um, um,
Speaker: I think we, it's also that, you know, it's like, I didn't have enough senior or any senior person in my company to help me on the business side of things. But you learn that because, you know, you don't know what you do not know. And you start a business as a novice, as a very naive person, what do you do? So, so yeah, so the way I look at it, it is what it is, it was what it was. The question is, you know, life through a curve ball, you got to deal with it and you figure out how to deal with it and what to do about it.
Speaker: And then you do it. Things will happen. If not, there's something else with that. Question is, how do you deal with it? How do you confront it? How do you resolve it? How do you overcome it? And you were able to do so. So you basically got more aggressive with sales to get in more clients and make enough money to cover up the debt and pay off all of that.
Speaker: So then he paid off everything and took us about like six years. But yeah, it was pretty tough because at the same time when the company was floundering, my mother was discovered with cancer in India and in India. So three weeks I was going to India, three weeks going back to the US. I was doing three week trips. So while I'm running my company through as worst a time as one can expect that I do the personal situation. So it was pretty brutal, but
Speaker: You know, it's like, it kind of taught me who I am and, you know, built it once, you know, a lot of character for me in shaping me and defining who I am and how I deal with things. And, and I think I came out of it. And how much would you earn from a customer on an average? Like, it all varied. It was like a fixed rupees per, or dollars per license per year, that kind of. No, we had a perpetual model. So you charge them up front and then collect maintenance of
Speaker: 16, 14, 16, 20%. But all in all, the price point of a product kept increasing over time. At that point was from as low as 500 to 2000 to 50 ,000, 60 ,000, 70 ,000.
Speaker: But of course, later in the years, you know, EdFX was doing million dollar deals because he had built more and more products on top of what he already started. So that kind of, so the price point kept going up now. Help me understand the product evolution journey. What, like, what were the additional products you built that led up to like million dollar deals?
Speaker: Yeah, so we had the design product, which is the documentation product. We had a runtime engine to process that information. We had the management console layer on top of it to manage the flow and show visibility to what transaction coming in, what happened to them, what field, why they're fields, so you kind of have complete visibility, visualization of it.
Speaker: And then we build more workflow products. So this is one product for transaction processing and management. And then we build a product for enrollment and encounters processing. So enrollments are when a employer sends information to the peer saying, here are the employees that have been enrolled.
Speaker: or the enrollment status has changed. So you just send that feed because that dictates the premiums that you pay to the health plan. So we get into that and crossing that feed encounters as a way of sending data to the government so it can be reimbursed for managing a certain segment of the population. And if you don't send me clean data, you won't get reimbursed. So we had a very good way of ensuring that clean information went to the government so their reimbursement rate was 100 % or close to it with the ability to rectify and get 100%.
Speaker: Civilian encounters product. And then lastly, you know, the latest part, we had builders population payment. Most of the contracts in the US are fee for service. You get paid every time you provide a service. Whereas trying with the idea of pay for performance is how well you do by a patient, not how much you do for a patient.
Speaker: So you build a Payful Performance product, and that's the latest product. And then they launched another product right now called Prior Authorization to authorize prior and expense before it's in good. And you can electronically send that get out. That means that if I do this procedure, I will get reimbursed. So the provider sends that to the payer. So we had added that product also just for use. But we kept building more and more workflow products. So picking the workflows, instead of being in data interoperability and data exchange efficient, we made workflow more efficient.
Speaker: taking one complex word at a time. The core reason for someone to buy the product could be that you would clean up the data.
Speaker: The first part was to ensure that the data is clean, that goes out, and it is correct when it comes in. The workflow is to ensure that the flow of information and the accuracy of the workflow is very complete, because otherwise the system they were developing were manual, they were not well -crafted or architected. We ensured that the whole enrollment processing was very efficient, and the encounters submission was very efficient.
Speaker: So besides the Interoperability Gateway for data processing, we had the workflows and each had its own reason to exist. And your users here would typically be like a software engineer, right? This was not a product for the end user, like say someone who is in the back office who's actually processing data or processing claims or so on.
Speaker: No, the, the, every company has what we call a EDI team or whatever you want to call that team. And the team was responsible for defining the transactions when showing the data was flowing back and forth correctly or encounters are flowing back and forth correctly. So they were responsible for that. And so, and every, everybody, everybody had, you know, every company had either unless, and if they're very small, they would have what I call, you know, an outsource model, outsource the whole thing to somebody.
Speaker: Hey, we're too small or we just don't want to focus on this, et cetera. So this was a product for the EDI team basically to help them be more efficient. Yeah, that's right. Got it. And how did the business side of it evolve over the years? You were personally leading sales? Yeah, for the full number of years I did sales. I led Adendai Sales and Marketing.
Speaker: and the product management. So I defined the product and called the product. Besides that, I was quite involved on the support and services side in shaping that and bring those teams. So for a long time, I ran all of those teams, ordered myself till they were big enough for me to hire those people to run those teams.
Speaker: And what was the trend line for the revenue? Like you were at 1 million around 99, 2000. So how did that? So in 2000, 2001, we were a million plus in revenues. And then in, I think by 2005, we might have been, I think it was up 10 still. And by 2010, we might have been a
Speaker: I don't know, 10 million dollar company, I don't know, something like that, 10, 12 million dollar company. But our revenues kept increasing over here. I think we sustained a growth of about 50 to 20 % over here on the top line. But eventually we also put down to say we have to be profitable. And then by the time we, a couple of years ago, we were growing at a top line of 17, 18 % with an EBITDA margin of 45 % plus.
Speaker: That's amazing. What are some of the lessons you can share about doing high ticket business to business sales?
Speaker: I think it's value, right? You have to have a product that gives a value to the customer, the product should work. It should work first and then provide increasing value over time. And when you provide the increasing value, you become more and more indispensable, but also it's very difficult for somebody to kind of come in and replace you because they picked you and you're improving the product month after month. So I think to ensure that you get great value to your customers and increase the value over here is important.
Speaker: As regarding the ticket, high ticket, you have to be value -based selling versus just like, here's a product, here's the features, here's the cost. What's the value that gives you value -based pricing versus a pure one in a transaction -based pricing? That'll be the second as we're pricing. The third is that you have to make sure the product is enterprise -grade and enterprise -wide adoption. If you don't have that, then it becomes very difficult.
Speaker: to kind of to sell an enterprise -grade product at, you know, million or a few million dollars, a customer. But those are things that you have to keep in mind. How do you do value -based pricing? You kind of see what the value the customer, see what's the pain the customer is having, what, how much are they, you know, how much is it costing them to do this and how difficult it is and how big the need is.
Speaker: And in the process, you say our product delivers this value to a typical customer. And therefore, we should charge it. They can reduce headcount by X. They can become motioned by Y. There's a compliance manager on top of it. So you look at those different variables and then say, you know, this is how we want to price a product. And over time, you go straight, you start somewhere, and then you start tweaking your pricing, and then come to the pricing that you really want to open. How much should you leave at the table when you do value -based pricing?
Speaker: Like, should you leave half the value on the table? It's not a science. You have to kind of, you have to feel it through and try different pricing and see what happens. But it's not something that you can just kind of scientifically say, oh, I see with five headcounts and they were paying for three.
Speaker: You have to see, you know, some total of a number of things coming into play. You have to understand the business really well. You have to understand where all your product fits in, what the ancillary cost, and then the processing. This product should be priced at this for customers, and they will pay it. And over time, you incrementally keep changing because you get more mature in understanding the customer, the value of the product, they're probably increasing. So you keep tweaking it to come to a point, say, you know what, this is a good stable point for a product, and we keep doing a course of
Speaker: you know, living adjustments, so to speak, every year, because the product, you know, it's got more and more expensive over the years to be looked at. And do you face pushbacks when you increase the price every year? We did, but, you know, we did, we did increase the price by, you know, 10%, by 2 -3%, because we are allowed to do that, because we're making a contract that will increase the price, so that we are allowed to increase the price of product up to X.
Speaker: So they already knew that going in. It's only if you decide to charge a lot more than that, that becomes an issue. But if it's within that, some customers are always complaining, hey, why am I paying extra? I'm not getting that much. And there will always be that customers, but it's one size fits all. We say this is what we're increasing and we do what we do. And there's some people who listen to the customers say, well, let's figure out how to make you whole. This is too much of a bump. And then you work with those customers. But no, it was not a major problem. Sooner or later, we solved all the problems.
Speaker: Help me understand how you build a team and a culture for anything. The team was built 101 % of the time picking out who we want in the engineering side, who do you want in the sales side or marketing side or corporate services, admin services. So that's a trial and error that you do, especially if you're not from businesses before.
Speaker: So you build a team one percent of the time and the culture is where, you know, you define, you know, what's your North Star. And from that North Star, you define what kind of company you want to be and therefore what kind of people you hire in that company. And with exactly that, we hired people who are very motivated, were culturally aligned in how they conducted themselves and how they work, how they interact with other team members. So we had, you know, it's a lot of trial and error. We learned a lot, but eventually put together a pretty good team.
Speaker: So, you know, tell me about the exit. I believe you had an exit here in 2019. Yeah, we had an exit in 2019. We sold over half a company to double the private equity guys. And, you know, it was time for my leaders to realize some gains from all the options. And because they worked, you know, my leaders had been for 10 to 20 years, depending on who it was. And those all run you with your attrition rate of like one, 2%.
Speaker: The number of people over five years, ten years, etc. was pretty big. So I want to kind of give them rewards for what they have done. So they kind of acquisition or they became a good thing to do.
Speaker: I was going to acquisition the macro pre -frothy, but you know, we're a darling of the industry, right? Our kind of companies don't exist too much. And if you look at our, if you look at a company that is in a vertical that is growing 50 and 20 % year over year with 45 % of the margin, not 100 million revenues, those are very few companies. Then we owned our, whatever we did, we owned that space. It would be very difficult to compete against. You had crossed $100 million by 2019.
Speaker: We had, we were $150 million company. Wow. Amazing. And this was from, what was the country I split for this? It was mostly US. We had very little revenues from outside. And it was all healthcare companies only, like from a sector perspective. It was all. And so you could have also looked at an IPO as an option. Why choose M &A?
Speaker: They can do an IPO. It's not that you can't do an IPO. There's a lot of baggage and there's a lot of inertia you need for the public. Everything from having investors backing you up so they can do a roadshow, show the company has its jobs. Number one. Number two is that you have a very strong leadership team, which is different. Our team was not strong enough for an IPO. They were strong enough to run the company.
Speaker: because the IPL will look for some kinds of leaders and leadership team. So instead of going the IPL route and studying through it, we said, you know, let's just sell out of the company and getting a good result.
Speaker: And we still hold a significant stock in the company, me and my leaders. And so I just worked out well. I was always an option, but we didn't think there was an option for us. Given what we are thinking in terms of just where the company was, and remember that
Speaker: we had we had cultivated the company and built over time where I took very junior leaders and build them in within that effects. Whereas in a typical mess of funny company, you'll get a lot of outside, you get a lot of outside the leadership and they look good on paper, they look good on the resume, they look good on the website. But I had cultivated them from being very junior people, but they became very, very good.
Speaker: And so while external entities might not respect or appreciate the depth and the relevance and the potency of our leadership team, not that it was complete well that we had people, but you know, IPOs is a different kind of packaging. And especially when investors becomes a bit doubtful at that time.
Speaker: Did you also choose M &A because you had decided to take a step back? Or did that taking a step back happen once? Did that follow the acquisition? No, I took a step back after. So we sold the company. Then I gave the baton to my number two, who became the CEO of the company. So about six to nine months in the company, I transitioned over to another person because I was not interested in the company.
Speaker: And I was not ever running the company much anyways for the last seven, eight years because the operating council is running it. I had my council, my top leaders, and they used to run the company. And I really, when like five years I was sitting in India for 14 to 19, I, um,
Speaker: There was five years the company was running autopilot because the operating cost was running. So I was not really spending more than half an hour on the company. Because the company was running good. The profit margin was good. The growth top line was good. So I didn't have to do much. I could have declared a CEO much ahead of time. Yes, I could have done that. There would have been a good move. But no, I didn't have to be too involved.
Speaker: What were you doing in India? I was just there for some personal reasons. So I just moved to India. And right now you're back in the US. So what next? Once the sale happened, I assume you would have got a decent amount of value for the equity which you bartered with. Yeah. So it was, it's a good exit. How much was the company value? It was the unicorns. It was north of the pavilion.
Speaker: So, you know, it was a pretty coveted asset in the healthcare space. When you enterprise healthcare space, there are not too many assets that are of that revenue with that top -line growth and that kind of revenue margin. And the dominance we had in our products, any area we were in, we dominated that area. So given all of that, it is not those kind of assets that are in between in the healthcare space. And so we got a good value for that company.
Speaker: So, you know, tell me what your personal journey from here, like once the sale went through and what next for you. Yeah. So then, you know, I had, by that time, I really started working around glass while I was in India. And, you know, I was disenchanted with the healthcare system of the world, US, including it, it was like, what do you call it, a disease management or a sick care system. You've all sick. We either do nothing public with chemicals, opportunity of the night.
Speaker: And so what happened was that I said, I worked on a concept for, how do we care for people? And the concept was holistic well -being. How do you ensure physical and emotional and spiritual, social, professional, financial, community and planetary well -being to be at eight pillars of well -being. So he said, how do we take care of people? And there was holistic well -being. I said, how do we manifest that into product?
Speaker: How does an app solve this? And so my journey became that around the last wave. So how do we fix these problems that I saw so easily? So basically showing people how to live because it's a modern lifestyle that causes most of the chronic care diseases, whether it's cancer impact pain and depression and blood pressure and knee problems, et cetera. And 70 % of the healthcare dollars in the US goes towards chronic care and probably end of life a little bit.
Speaker: So our intent was if people can live well, they won't face all of these lifestyle diseases that is making them ill. But at the same time, you know, causing such a drain on the healthcare system and the healthcare system really will not work.
Speaker: So that gave the genesis of Roundglass, to build an app or a product that becomes everybody's life coach and shows them how to live from the day to day to the big issue that they are thrown at them or the curve balls that life throws at people, how to deal with all of that and live from a foundationalistic well being lived from joy. So that becomes the rallying cryo mantra for Roundglass. So how do you get people to live well?
Speaker: Um, so I think for people to live well, um, you know, it's, um, it's, it's, um, what I call awareness. How do you create an awareness of things that are good and important for you, but you might not know. And then how do you give them a way to practice those aspects and things in life so that you just make it second nature, like brushing your teeth and having breakfast.
Speaker: And so you can either come and say, hey, I want to explore meditation or I want to, you know, find a better way of living. And if I'll explore what you allow me to do, the content and the tools that we have, or you're saying I have very specific issue I want to deal with or, or, or, or focus on.
Speaker: And that could be, let's say, stress in the workplace or stress in a relationship or whatever. And so I think when that happens, you come to our app and say, let me get started on nourishing my relationships, or let's get started on how to reduce stress in my workplace, or how do I get healthy habits? So you start saying, let me get started. And then we show you a bath away.
Speaker: to enable focus and solve that and overcome that issue. And then you go deeper and deeper so that you can become better and better at addressing that issue, like parenting a teenager.
Speaker: So we give a very prescriptive way, structured and unstructured, of solving those issues through all the tools of holistic well -being. It can be meditation or sleep or food or music. There are so many tools, so many pathways or verticals you have. So we say if you mix and match these things, you can solve this issue.
Speaker: And some people might have my gravity towards certain tools and pathways or verticals more than the other. So you then reject the formula to give them more of what they resonate with and less of what they don't resonate with and make the formula better and better for them over time.
Speaker: But we will take seriously every modality of holistic well -being from what we have today, which is meditation, such mindfulness, food, music, yoga, movement, to many others that we'll add. And the potpourri of that will allow you to solve any particular issue in life.
Speaker: life. And then as you learn, you can create your own custom journey or your own custom solution that when this happens, this is what I want to do is he pick and choose and you can create your own custom program for healthy habits or healthy routine or healthy eating habits. Or when you get stressed out, what do you do?
Speaker: The journey starts with like some sort of an assessment or something. No assessment over a period of time. It doesn't happen right away. So just say you're in a process of getting to know you. So you don't become a friend overnight, right? You get to know your person, whether it's a friendship or a relationship over time. Similar that you ask questions, you observe, you try things, some things you like doing, not doing, something like doing together, not doing, you know, you learn from,
Speaker: you know, the things that happen in the relationship and then you become better at it. The same way we learn from the users, from their content they're consuming, from the questions that they answer for us, for the things that they pick. And from that, you get to know them better and better and therefore become better prescriptions for them to become a more effective life coach. So we are a digital life coach.
Speaker: So let's say, if you could say I am a potential customer, what would my journey be like? First of all, how would I learn about the app? How would I discover it? Do you do some sort of paid marketing or is it on the basis of what about?
Speaker: How does discovery happen? So discovery is, you know, regular growth channels, right? You, you have users and you have a database of users. You want social media, you do pay and you can do PR. You can go through and search. So we explore all of those channels and see which ones are more beneficial for us for the money we're spending.
Speaker: And as a result of which we really fine tune our marketing. But there's a process we're going through right now. It's figuring what are the right or the best channels for us? What do we ever say and how do we receive our story? How is the storytelling very focused and very targeted? So the storytelling, what channels to use, how much money to spend, where all of that is the fine tuning we're doing right now.
Speaker: So let's say I discover and download the app, then what makes... You pick an area you want to focus on and then based on what you pick will guide you through what you have to do. That these are things you can do in the different areas of holistic well -being in order to address that. Like I would pick for example yoga if I think I need to be physically fit or I would pick meditation if I think I need to focus more on my mental well -being.
Speaker: That's how it would happen. Yeah. So it can, it can focus on the, you know, pick a vertical like yoga meditation, or you might pick something like I want to manage my stress and we'll tell you what a yoga and meditation or food or music you can do or listen to in order to address the stress.
Speaker: So it has like a lot of categories which you can browse through and then pick a theme. And on that theme, there would be like a set of videos. How do you like videos and audio and written content? Yes. So it's some total of content, different formats, video, short form, long form, audio, written in the different verticals, all coming together to solve this, which provide a solution.
Speaker: And how have you built the content? We have our own studio team. We have our own content team. We have our own studio team. So we have experts who define them. Like you've not acquired content from us and everything you've built in -house. That's correct.
Speaker: So I'm just trying to see what would like, you know, if I'm let's say interested in meditation or interested in cooking and so on. A lot of these social media apps or YouTube or the short video apps would anyway be learning from my behavior and showing me those kind of videos and the number of videos which they would have would
Speaker: I mean, it's like a constant increasing library because those are user generated videos. So for me as a consumer, I would probably be more inclined to spend time there. Like what would make people adopt this app?
Speaker: I think the reason you adopt this app is because it is holistic. It is not a singular pathway app. It's not a meditation app per se. Meditation is a component of the solution, not the solution. And so the very fact that we are solving your problems holistically through different pathways, the fact that we are problem -centric,
Speaker: right? We take a problem and say this is how you're going to solve the problem. There's some total of things. That's how we reduce. So it's not a singular vertical app, like a meditation or a fitness app. It's a sum total of everything you need to do and see what resonates more than the other to solve very specific problems in your life when it comes to how you live.
Speaker: So TikTok would be similar, right? Like on TikTok you can get meditation videos or you can get cooking videos or you can get fitness videos or whatever. So, you know, what would make me want to come here instead of like a short video app or something like that? Yeah, so two things. One is, you know, before TikTok it was YouTube and there's all the social media. So we could have used that too with the fact that it doesn't solve the problem.
Speaker: As a matter of fact, if anything, all these social media channels have screwed up your life. And also with kids who are addicted to these kind of things. Because they don't solve the problem. They create a problem. Actually, they feed into people who want to use our app. Second is don't structuralize anything. They don't think this is a program or a path or a sequence of things you can do. You have to go discover.
Speaker: Yes, you can go explore and discover and figure out what works for you, but I have a hard time believing that somebody who is stressed in the workplace or want to touch the relationship to just find a bunch of videos that just helps them. These things are ultimate in behavior change. Living through holistic well -being is the ultimate in behavior change. It's showing the change the way you live. It's about living.
Speaker: And so there has to be a place where you have very cleaned up content with the right scripts, with the right presenters, with the right themes, and in the right order and sequence of how things have to be done.
Speaker: That social media or YouTube or even the web will give you a whole bunch of stuff, but won't tell you what to do with that stuff or how to really truly and average it. I'll set off, yeah, if you want to be anything but explorer working every day, working a couple of hours, figuring out things, you can do that. There's absolutely no harm. But then you will take a video from here, sync from there, collate it. This is what I want to do. You know, keep track of it. Then you have another thing. And then if you want to, you know, so you could do it.
Speaker: But do people have the time to really go and explore, you know, and see what reason is where you could do it. But that's, that's a very expensive way. It's a very heavy footprint to able to go and look and solve problems.
Speaker: So like if I'm choosing stress at the workplace, then through round glass, it is a guided journey where each and everything is about stress in the workplace. But through the social media app, there will be like a mix of stuff, some related to one thing, some related to one thing. There's no kind of a guided true journey through over there.
Speaker: How did you? Is there a science behind the content that you created? Like, let's say you took stress at the workplace as a theme and you created content for around that. So is there a science behind that? So some way in which you know that my content will overcome this problem. Content is done by experts who have been in this field for decades. So there is some level of scientific or evidence behind it, but not everything about holistic well -being has
Speaker: a scientific backing, so to speak. It has historical time -tested backing, but our intent also is to bring that time -tested into a scientific realm and say how scientifically, how evidence -based, how does this really showcase itself? So that onus is on us.
Speaker: But that being said, nor software of ours is scientific and evidence -based, nor stuff, you know, the experts that we use are very, very solid. The scripts are very clean. The processes, the programs are very clean. And we are getting more and more into making everything evidence -based or scientific. Like for stress at the workplace, there would be like some sort of a psychologist who specializes in this area who would have created the context for you.
Speaker: And how do you monetize the app? So, you know, we have a free version of the app and we're going to have a premium version of the app. And so the premium version will charge us some number of dollars per user per year. And there'll be a revenue stream. We'll always have the free app because we want to democratize holistic development for the world. So there'll always be a free app and there'll be a premium.
Speaker: So are you building around us with the goal of profits or are profits incidental? No, you have to be a sustainable company, but you plug the money back, the profits back into the company to reinvest in the company to, to share with associates the success of the company financially. So, but all the money will be put back in.
Speaker: And why would someone subscribe to the premium plan? What do they get? We're still figuring it out. We have a lot of ideas, but we haven't really nailed down what we're going to premium, what we'll stay in. So currently in the free app, you know, can you share some numbers? Like what are the number of users that you have? We don't have a lot of steady data because they're fairly new app. So we're still figuring all them. We just started a marketing. We didn't do a lot of marketing last year.
Speaker: So we launched it, but now we're doing proper marketing. So the numbers will be very preliminary. They won't make much sense. They're not that big cause you just launched it. Now we're putting marketing behind it and we're building the next version of the app. We will, you know what, this is what the app truly is all about. And we have done, we have done some good marketing behind it. And therefore the numbers are, so you can ask me the question six months from now, I'll be happy to answer that because I'll have good data to back down. So, okay.
Speaker: Yeah, yeah, yeah, got it, got it. And I believe there's like a CSR also from West. So Roundglass has a giving area which has three initiatives. One is Roundglass Sustain, one is Roundglass Sports and the third is Roundglass Foundation. The sustain part was showcasing the biodiversity of India in an educative entertaining manner now. India is one of the most biodiverse countries in the world, but we don't understand, believe, showcase or love it in that fashion.
Speaker: So we've done a phenomenal job, I think, in the three years or so that the sustain team has been working. We have started chronicling the habitat, the species, the wildlife, the conservation, the impact story, the human stories. Play to sustain in India, the focus of their part of sustain.
Speaker: In the foundation, we've done some really good work, almost in 1600 villages of the 12 ,000 plus villages in Punjab, which we are making them eco -sustainable, all of them in 20 years. So we have learning programs, sports programs, tree plantation programs, waste management programs, rainwater harvesting programs. We have a lot of programs, some in foreign production and some in pilot.
Speaker: And the idea is that each village should be environmentally safe, water, soil, and air, and financially sustainable so that nobody has to leave the village. And so we have now reached almost 1 ,600 villages in the year 5, which is a formidable kind of an achievement. But we will leave between 2013 and 2035. All those 12 ,000 plus villages will become eco -sustainable.
Speaker: We will have a generation of kids growing up globally away to our learning programs, kids playing sports every evening. We will plant a billion trees. We will have waste management with solid waste from houses be totally composted and reuse as organic manure. We are introducing solar, rainwater harvesting, cleaning up sewage water for irrigating farms, yoga, self -help groups. So we are doing a lot with some pilot programs.
Speaker: The third is sports where we have, it's a football -centric academy, but we have other sports like field hockey and tennis. And it's an academy based on the holistic development of the child. And as part of that, they become great athletes in their discipline. In football, we are number one in iLeague, as of nowadays in the tournament. Under 18, 15, 13 teams are top in the country.
Speaker: the number one women's tennis place from our academy, tennis academy, number one second, and it's an extreme place from our academy, the year end of the year old. In hockey, we have a lot of development grassroots centers and we are playing our kids two years, two years ahead. So under 15th grade, under 17, under 13th grade, under 15. And again, they are winning tournaments and they are in football, hockey, and tennis.
Speaker: They are making it to the national teams. They've been called to the national teams to be part of the team. So we've achieved a lot in the three plus years that the Academy has been functional and we've learned to grow it. And, but our intent is to, to do it right. We have a very good model of staffing, of infrastructure, of how we create a welcoming class of academies to feed in the elite Academy. How, what is the scouting program? How's our, as the development program for holistic welding. So it's a very different differentiated Academy and the results will show in the years to come.
Speaker: Because a lot of people don't understand what we're doing. And you're not doing it for commercial reasons, so it's going to be more difficult to understand. But you're doing all the right things for international standards to produce international leading athletes coming out of India and show India how sports should be done and maybe some other people in the world. But it's a program that you've done a good job. Where are the academies? These are like physical campuses, right?
Speaker: Yeah. So, um, uh, the academy is in Muhali, um, for all three of them. Um, development process would be wherever the centers are in different parts of Punjab. Uh, and we're the pros and building more infrastructure now, but we all rented accommodations and, you know, residential school and pictures. They're all leased out these buyers, but eventually we're building our own infrastructure.
Speaker: What made you want to do this? Like, I'm guessing one part of it would be that you had cash from that exit and therefore you wanted to do good. But why specifically focused on India? Why specifically in this way? I had said that before even the exit because I saw round glass by that time and so it was pre -dated round glass. The reason I did because, you know, the thing is I was in India, I saw the problems in India, I should have sat here and especially in the state of Punjab.
Speaker: And so we're doing big things over there and the reason you know, the way I look at it is that we are focused on Punjab, but we'll open the blueprint for the rest of the country, the world to learn from us, embed their people, learn from our playbooks, we'll write visibility into our financials and our frameworks and our metrics and our studies, etc. So we'll open source all of that.
Speaker: So others can learn from it, but you only want to focus on Punjab. And the reason I'm doing it, because I can. My formula in life is very simple, to whom much is given. And if X is given to you, then 100X is what you owe back to the world. And that's what I'm doing. I got X in financial and experiential resources. It's a plan to give 100X back in impact I want to have with what has been given to me. So because I can, I'm doing it. And because I want to be in service of humanity,
Speaker: For the rest of my life, I believe that I've taken a lot of time to give back. And so I've gone to a certain stage where I've learned a lot of stuff. I can now use all of those resources to do something that's good for our planet and good for our next generation and good for humanity at large. It's because I can do it. I'm doing it.
Speaker: Amazing. And is this all only your money or are there other partners, donors? Right now is all my money. In the foundation work in Punjab, we will start doing fundraising through our efforts, through the program we're putting together. But for so far, for pretty much 99 .9%. The reason why I say point one is because we have done various very tiny amounts in the foundation. So that accounts for maybe a couple of percentage points or something like that. But for most part, it's my own personal money. That's right.
Speaker: And how much do you spend annually? How much do you? You have spent today, I think north of, on the foundation itself, you spend about 10 million to date as of end of last year, just the foundation. But in sports and sustain, there's more money. They spend more money on additional money on sustain and sports. And sports is an expensive proposition. So yeah, all in all, I think probably you spend north of 25 to $30 million already in these giving initiatives.
Speaker: So why is food, I can understand sustain because it's like at the grassroots impact that is happening. Why is food, why didn't you want to spend on that?
Speaker: The way to kind of, you know, what sports teaches you, nothing else can. And I think, you know, Punjab is a state where a lot of great sports people have come from. So it says sports is in their blood and how to leverage that. And also how to show people that sports as a career can yield results, can yield a life that you can, you know, you can settle down. So I think a country that doesn't respect sports is an element of life that you're missing.
Speaker: I can't think of a country devoid of sports. Imagine India devoid of cricket. What would India be like if there was no cricket, no football, no hockey, no tennis, no table tennis, no kabaddi? I think that would be a pretty boring country.
Speaker: would be intellectual quantificators, which is nothing wrong with that. We have made a, you know, people have done great, great things over there. So I think sports, not just competitive sport, but sports as a, as being part of your life, teaches you things that other things don't. And so I think it's important for the overall wellbeing of an individual to be involved in sports, to be
Speaker: not because I'm going to play competitively tomorrow, it's because it teaches me things that the school and the other things will not. Physical fitness, it teaches you mental toughness. It shows you teamwork and therefore how do you carry people with you? How do you learn to play with people? Every sport has different things. Sports has become a bit
Speaker: corrupted in some way because it becomes highly commercialized, very money -centric, with very very strong vested in trust. And I hope that we can show the right way to do sports to India and to the world that look, care for the athlete, take care of the athlete.
Speaker: take care of the coaches, make sure they also get paid well, they also progress, and let these lead athletes become great role models for kids who look up. Millions and millions and millions of kids that look up to these sports people.
Speaker: And I don't know how many of these sports people take it seriously, saying, I am a role model. Kids look up to me and adults look up to me. What do I do for them? Because I've been given this privilege of 100 million followers, of 400 million followers, or a million followers. And they watch every step of life.
Speaker: And you want to show that these elites at least have a responsibility to a society. And we'll teach our kids that when you become a national, international repute sports person, that you have an obligation to society because those people are put you in a pedestal. You're like a human version of God, so to speak, right? That they revere you, they worship you, they cry for you. And therefore, they have an obligation to the world and responsibility towards those people.
Speaker: and therefore you must behave and act differently than the mere mortals and the people who are as accomplished as you are or who perform as great as you are. And that I think goes for every leader. Everybody who is highly accomplished and highly successful have an obligation of society to lead by itself. So why are you based in the US when there is so much that you're investing in India?
Speaker: If I have a home in India, I have a home in the US. From my own, my business dealings are in the US, and therefore being in the US is important for me.
Speaker: I go to India three, four times a year. I look at all, I have a very good team over there. So yeah, I'll keep going to India all the time. But the, the, the for profit and round glass business that is based in the US. I want to say based in US India, I said go to the US, but the market is the US, North American Europe for the most part. So for me to sit in India and run a business won't make any sense when our markets are here and, and with the kind of work that's happened.
Speaker: So the Roundglass Living app is primarily targeting the Western audience? Not necessarily, except India is not a commercially big marketer for us. It's a market but a commercial big market. So we are selling in the US, we're selling in India, we'll expand our geography, but India is not a big commercial market for us.
Speaker: The Roundhouse Living app, I'm just wondering if for something which is pure self -based learning, so essentially self -based learning, right? Like videos which you watch and learn on your own. Yeah, you will have access to practitioners and experts also, but for the most part,
Speaker: You know, for the most part, it is like a digital life coach, you know, giving you guided journeys, as you called it. So it is a lot of self -observation, self -learning, self -practice, but with access to better out experts and teachers that you can engage with and interact with.
Speaker: I'm just wondering if self -paced learning as an approach will have high engagement rates or not. Like, you know, out of every hundred people who download and install the app, how many would still be using it after three months? I will see. I think we'll be successful. I think we believe that we can provide a digital life coach and be very effective at it.
Speaker: But this is some total of also giving social creating social tribes and access to a marketplace or very loud experts and teachers globally. So we believe that our formula is correct. Um, in the next few years, we'll execute a lot against that formula and we'll see where we end up, but I think we have, it'll, it'll work.
Speaker: Otherwise, it'll never be scalable. There's not enough experts in this world to solve the problems that people are facing. So it better work because they have no other choice. You don't have enough experts in the world. And the experts are not even uniform in there. Only maybe 10 % of the experts are truly really good. 90 % are awash. So what are the good ones? Are they giving the right advice? Can it be scalable? If digital doesn't work, then God help us.
Speaker: And that brings us to the end of this conversation. I want to ask you for a favor now. Did you like listening to the show? I'd love to hear your feedback about it. Do you have your own startup ideas? I'd love to hear them. Do you have questions for any of the guests that you heard about in the show? I'd love to get your questions and pass them on to the guests. Write to me at adatthepodium .in. That's adatthepodium .in.
