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Building the last mile stack for home loans | Atul Monga @ Basic Home Loan
209 Plays1 year ago
Even though banking and finance have gone digital, many still rely on traditional methods for getting home loans. While this may be fine for expensive homes, it becomes costly and difficult to expand when it comes to affordable housing. Atul Monga is a fintech veteran chasing an ambitious mission to make affordable home loans accessible to Bharat by using an innovative asset light approach.
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Read more about Basic Home Loan:-
2.Affordable housing market in India is valued at $300 billion: Basic Home Loan founder Atul Monga
4.Looking for a home loan? this startup is ensuring hassle-free loans with its automated platform
5.Our small-ticket loan customers have grown by 5-times: Atul Monga, BASIC Home Loan
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Transcript
Introduction to Basic Home Loan and its Vision
00:00:00
Speaker
Hi everyone, I am Atul Monga here and I am founder and CEO of Basic Home Loan.
00:00:19
Speaker
Here's an interesting fact. Despite all the digitization in the financial services sector, most people today still use a very offline approach to getting a home loan. This works when the price of a home is a crore or more. But when it comes to affordable housing, an offline process becomes expensive and hard to scale. And this is the opportunity that basic home loan is chasing. Atul Monga, the founder of Basic Home Loan, is a fintech veteran and is chasing an ambitious mission
00:00:47
Speaker
to make affordable home loans accessible to Bharat by using an innovative asset-light approach. Stay tuned to learn more about how the home loan industry operates and how basic is disrupting the market. And please do subscribe to Found a Thesis on YouTube or any audio streaming platform.
00:01:13
Speaker
Okay, so before we talk about your journey, can you give like an elevator pitch of what is basic of web?
Digital Transformation in the Mortgage Sector
00:01:25
Speaker
Okay, at basic home run, we're trying to digitize mortgages in India. So you see, mortgages is one of the three key necessity of any as in home is the key three key necessity of any human being. But in India, if you see, we have the highest from this population in the world, people living in slums, people living in, you know,
00:01:45
Speaker
not you can say practical houses they are living and the problem in India is not that we don't have land or we don't have money to live through these people the problem is that lenders want what people whom they can lend and the customer need money so there is no bridge over here obviously there are traditional channels like bank branches or agents in between
00:02:05
Speaker
But there is no tech play here. In India, mortgages are just 10% penetrated, which is very low as compared to international centres. So to bridge the gap, we started basic and we started as a broker initially. And what we did is that we go to customers, we help them qualify for the right bank.
00:02:21
Speaker
Then we have the integrations with the bank where we do capitalized applications and we help them in tracking their applications. And we help them respond to the final disbursement of their loan. We follow a digital approach because few things cannot be 100% digitized in India like mortgage evaluation. We don't have a mortgage database in India or a property database in India. So that's supposed to be done offline. So that is done through our agent network.
00:02:45
Speaker
So in a way for our passwords is a completely digital experience sitting at home, then letting their home runs done.
Growth and Financial Strategy of Basic Home Loan
00:02:51
Speaker
And we are trying to digitize the various work streams which are associated with the, you know, mortgage application in India. So what are some numbers about the business? What is your disbursement rate, like monthly disbursement, total amount disbursement, what, you know, just share some numbers about basic.
00:03:13
Speaker
Okay, we started three years back, and now we are at a monthly rate of close to 1000 crores of disbursements per month. Every month, we get about 5000 crores of home loan applications, and we are able to disburse 1000 crores out of it. In terms of our presence, we are now present in Qadhi cities. This India will have first applied for a year, and we'll be crossing 100 Crores in revenue. And, you know, we have been always cautious about our profitability. We are always profitable on unit economics.
00:03:43
Speaker
In last March, we have become profitable on a beta level. And we have been growing every year. This year by March, we'll be doing 2,000 corollaries of homelands every month. So at that time, we'll be the largest distributor of mortgages in India.
00:03:57
Speaker
And this year you also raised a series A of about 5 million. No, we raised a series B. One was during the initiation stage. We got some money on our paper idea. And then in 2001, we raised our series A. At that time, we raised close to 45,000, which is about 3.5 million.
00:04:22
Speaker
And now recently we have raised $40 in the mix of $5 million and everything. Okay, amazing. What made you the right founder to start this business? There is this concept of founder market fit. Just tell me about yourself and why you are the right founder to do this.
00:04:44
Speaker
Say, I believe in mortgages, unlike any other loan, you need some kind of expertise. It's not a number of customers' volume game, it's more of a depth game that how much you know about a particular case. Obviously, it's a wholesale lending, even though we focus on affordable housing loans, our every-secret scientists are also 30 lakh rupees or 25 lakh rupees.
00:05:08
Speaker
So, still, which is a big number as compared to any person on our business complex. So, even if you see big banks, their mortgage customers will not be in millions or tens of millions. It all will be limited, but it's a wholesale lending, so you need that debt.
00:05:24
Speaker
Now, I've been working in this space since 2015. I've worked in an across blending product. In my previous experiences, I have worked with companies who were like Nissan startups to people who have gone IPOs. So, I've seen the industry very closely from the engine angle, from the banking angle. So, I have been.
00:05:48
Speaker
In five years, I accumulated some experience in this industry, and then I got the opportunity to build something of my own. I cannot say I'm the top founder for this, but I believe that I can do it, so that's why I started it, and till date, it is working well for us.
00:06:06
Speaker
You said you worked in companies which were in the lending space. What was your role functionally? Were you in sales? Were you in underwriting? I was primarily in sales and business development. And maybe I can tell more about my career. My career is slightly gone.
00:06:25
Speaker
I changed back many times. I graduated in 2009 from Italy. So I started my career with credit choice as an inversion banker. I advise a lot of banks and insurance companies for M&As, IPOs, debt raises. For some purposes, I worked in India also. I worked on that quote again, ING really. And my last assignment was in Singapore in Hong Kong and I was working with a lot of financial institutions.
Challenges in Starting Up During a Pandemic
00:06:50
Speaker
In 2011, I got a tip from someone that what's happening in China right now. So I was helping a lot of Chinese companies for IPOs. Someone told me what's happening in China right now will happen in India in next 10 years. You should go to India, work in the startup ecosystem. And it was a good tip because in 2001, in 2021 exactly, we got our first IPO in India for startups.
00:07:09
Speaker
So in 2015, I came back to India and started working in Indian affect tech space. I worked with a company called Rubik. At that time, it was, they just started it. So I helped them raise their $3 million from Ferrari Capital and then joined them as a business development head. Then eventually moved to sales. What was the product Rubik?
00:07:30
Speaker
So they were doing all kinds of loans. They were a market niche for all the banks and all the products. That was a good experience because I learned the cross products. I learned for credit cards, personal loans, business loans, commercial making loans. They were doing everything. They were like bank bazaars.
00:07:47
Speaker
Yeah, but they were more focused on fulfillment. So they had an engine network. So lead generation was not only whether offline through agents. So there I got to work with agents, work with banks, and I saw the whole fulfillment process. It was not just a company passing on units. They were doing the fulfillment. So there I was able to see that thing happening across the product groups.
00:08:08
Speaker
Then the difference in these two approaches, company passing on leads would be like say a bank Bazaar and doing fulfillment would be where they have somebody who goes picks up papers, who gets the customer signed on the agreement and who submits all of those papers to the bank. It's more like an ESO business. And they were aggregating the ESO so that they can digitize these ESO industries.
00:08:34
Speaker
Now, both of them have different approaches. With DSA, you can even work on big ticket roads, you can even advise on complex transactions rather than just keeping it to correct cards or post-home rooms. So they have a different approach.
00:08:47
Speaker
Then I joined the policy wizard, so I was working in Passabazar as part of policy wizard group. And in Passabazar, I was managing again, they were doing something in the offline space through these agents only. So I was needing it as I was to say. And in 2020, when COVID happened,
00:09:07
Speaker
So, you know, I was looking for an idea for something, you know, I can do of my own. Send, you know, my television streams. It was apparent that there is a problem. People are moving out from cities to their houses. So, housing is a problem. I'm working in the same domain. So, that's how I, you know, the basic idea given to me. And I was lucky enough that I got a call from Ficus Capital for a job in Germany for their portfolio companies. And I didn't want to move out of India. I have seen some good success stories in my family only.
00:09:36
Speaker
my cousin, my brother, they have sold their companies, they have built more businesses. So I wanted to stay in India. So I just pushed them this idea and was lucky they helped me with a 500K investment.
Customer Acquisition and Lead Generation Strategies
00:09:47
Speaker
And that's how it all started. I'd say I was lucky enough that everything was falling in place. And I should not be saying this that I'm venting on someone's misery. But in COVID, a lot of people were getting unemployed. So I was able to get initial team members who were, you know,
00:10:03
Speaker
Very good people, they weren't just electrical because of Covid. So I was able to make a good team in the beginning and got some funding also, ideas were in my experience domain. So that's why we were able to scale very fast with all these factors in government. Amazing, amazing. Ficus Capital does like early stage investing.
00:10:24
Speaker
Yes, so PICUS is a European fund and they know investing at multiple stages. One such program they run is where they write ideas of paper, they write text on paper ideas.
00:10:39
Speaker
Yeah, you can say that they don't call it as a separate kind of program, but it's under by this capital. And at that time, by this wanted to establish their footprint in India, so they were meeting people. And that's how they got with the connecting with the ruling by the way. Okay, amazing. Amazing. Amazing. So luck made a large role in the
00:11:03
Speaker
Okay. Okay. What do you need to start? So essentially what you started was a digital DSA for home loans, right? We wanted to do it a different way. See the aggregation, to some extent, I believe it's very difficult to make it profitable because margins are very a way for things. So from day one, it means that you work with multiple DSAs as a layer between them and the bank.
00:11:29
Speaker
Yeah, okay. It's annoying us to bang. Why? Because the DSU is supposed to get X amount, you're paying him more because there's a liering between. So our model is different here. We don't just ask the agents to bring us customers. We generate our own customers and give them for 4-3 weeks.
00:11:46
Speaker
So, basically we have a funnel where we acquire customers. So, we have actually multiple funnels, multiple types of sourcing. One is through influencers. So, you know, when we started, we started with influencers channel that no one goes in the market to buy a home loan. People go in the market to buy a house. Now, if you're going to a CA for free advice, that server, where should I go for a home loan? Now, that CA will give you a free advice.
00:12:09
Speaker
If I tell that, see that, you know, refer that customer to me and then I'll give an expert to that customer and I'll pay you something. So, basically, I have monetized that reference for it. So, similarly, there are property dealers, there are many other providers. Now, we no input law even have, you know, many households in societies who are not referring as customers because, you know, at least in good law, if we go to any society, there is at least one NPG who is end up in the real, she will be doing some MLM on close ground thing. So, we make them as our influencers that if something is going on in your society, monetize it.
00:12:39
Speaker
Then second is our direct online channel where we acquire customers for digital marketing, Google, and other stuff. And third, we go directly to builders. So we saw that, you know, if you see any day in the market who is working on home doing, they don't want to work on small ticket loans because their direct economics don't work around there.
00:12:56
Speaker
And in an affordable housing loan and that to a construction link plan, the first branch would be very small. It would be 3 lakhs, 4 lakh rupees. And then after every 6 months, 5-6 lakh rupees of disbursement is happening. So the money is not that big. So they generally don't do these kind of cases. But since we are working through technology, so aerial economics can take that kind of cases. So now we go to builders, we tie up with them, we help them in getting their projects pre-approved from the banks.
00:13:22
Speaker
we integrate into the CRMs. So now whenever they are selling any new inventory or they're launching a new project, we get exclusivity in that, that we get wholesale customers, I think we get success rate 2000 customers worth of work bill, and we help them in getting loans from the bank. So this is our third channel, and then we have alliances with various other market players who are ready to real estate or, you know, allied services. So we get customers from them, and then we assign it to the TSS who are there in the bank.
00:13:49
Speaker
that these DSS now they use my mobile layer to qualify them for the right product then do a paperless application we have integrations with the bank so we can provide step-by-step tracking so all those things are built around technology in our system and so technically I'm not asking agents to give me leads I'm asking them to fulfill my leads and since we are providing leads so we have control over the payoffs to pay to them and that's how we become profitable
Financial Models and Regulatory Challenges
00:14:16
Speaker
Okay, amazing. I want to zoom into some of the things which you were speaking about. First of all, how does a DSA earn in case of a loan? Do you get a percentage of the amount disbursed or is it a fixed fees?
00:14:33
Speaker
So, you know, our fees are generally of various kinds. One is obviously into the disbursement amount. Once you do any disbursement, bank pay you a fixed amount. Then, bank pay you for selling new products also like if you cross sell home loan insurance or live insurance or if you have the disparate setting up a bank account with the same bank. Bank pay you for that money. And finally,
00:14:56
Speaker
Then there are volume incentives that issue to more volume and pay you more. For the bank, we are reducing your office. Whatever they are supposed to do and their branches through their personal, my agents are doing that. So more and more volume video, more and more they pass on to us. These are three types of payouts we get from the bank and they pass on a part of that payouts to the agents. Okay. You signed up with the banks and what was the nature of your relationship with the bank? You were a DSA for the bank?
00:15:25
Speaker
Unfortunately, with banks, there are only two types of relationships in the current bean market. And by the way, we are exploring third also. First one is a pure lead seller like web aggregators. Now, the idea is that when we started, we were no one and we could not challenge the bank to create something new.
00:15:44
Speaker
So, that's why we have to agree on the DSA. But now, we need to be around to enter into our own lending in affordable housing loans. So, now we are entering new kind of relationships, which is based on FLDC. So, with few banks, we've already got, you know, okay, and very soon we will see our own product in the market. We're up to 30 lakhs of home loans and all of this property we've been doing through a FLDC arrangement. So, we are not a DSA, we are actually a lender.
00:16:13
Speaker
Not a cold ending service provider. So in cold ending, I have to put my book also. That also will do in future. But as of now, we're starting with FITC and there we are introducing a new product. And the reason behind that is simple. I told you we get 5,000 crores of authentication and we are dispersing thousand crores only today.
00:16:34
Speaker
Now, we are weighing 4,000 crores, not all are bad customers. There are few customers for whom some products even don't exist in the market. The provider sub-specific provides. Real estate business is actually a very, you know, geo-wise kind of business. Like if I give you an example, B.L. it is the biggest in the north, or in Gurbal. They are not even present in Mumbai. If you go to Mumbai, Hiran Danyu, Rustamji are the biggest. In Bangalore, Brigitte or M.B.C., they are not even present in any other cities.
00:17:01
Speaker
So, you know, it's a very geo-pills business. Every geography has their own needs. So, every, you know, mortgage profile, you know, property profile has a different kind of treatment, which don't exist for all the customers. So, I believe we have found some, you know, blind spots, you can say, or areas where we get a lot of customers, but for whom the product won't exist. So, we'll underwrite them according to a new policy, which we have created with the banks. So, I wouldn't understand what is an LSP. So,
00:17:29
Speaker
There are three relationships with the bank now. One is you are a lead seller. Customer inquires on an online portal and the lead is passed to the bank. The second is you are a DSA, which means you help the customer process the loan, etc. And then an LSP, a loan service provider. What is an LSP? Like PTM would be an LSP.
00:17:48
Speaker
Just give me a one-on-one on FLDG also. I believe there are some recent regulations about FLDG which have come in place. This has been a fairly controversial topic.
00:18:02
Speaker
So in FLDC, what happens is that I go to a bank and I tell them that, okay, I want to lend on this policy. Now the bank can realize that policy and will tell me that, okay, the risk they believe is up to say 1%, 2%, 10% of NPA. So they will ask me to deposit a particular sum. Suppose I want a hundred gold book and they believe that the risk is say 5%. The bank will say, okay, you could be 10% of the money you are asking, which is about 10 crores in a FTE and I have the first gain on it.
00:18:30
Speaker
So if you get the customer and if you tell me to lend to that customer will do that. But if any entry cost will direct it from that deposit which we have. So for a bank it becomes completely secure to the end of loan because they already have the FD and they don't have to put any new back. So the lending service provider like us will be doing all kind of sourcing or the ops or the collections and it's just very secure loan for the bank.
00:18:55
Speaker
So this is how FLDC works. And recently, RBI is actually, there was a lot of benefits earlier, but now RBI has cleared the stand. RBI has made it clear that for any FLDC, the risk of the lending service provided cannot be more than 5%. So now for every 100 crores, you have to pay 5 crores of deposit to the bank. So for a bank, it is a very low number because they want to have maximum risk covered through the LSPs deposit.
00:19:23
Speaker
So now it is actually good for companies like us who have or which has some built-ins because now a new entrant will have to first prove themselves that whether they can do the effigy or not and then only vanquilling yet intro discussions. But since we have been working for the past three years and we have totally in total we have dispersed close to 7,000 crores of loans. We have logged in 17,000 crores of loans.
00:19:46
Speaker
Now banks know us, banks have seen us working and in our brokerage also our portfolio has been fairly thin. We never caught any red flag from the bank for NPA's or anything. So we have created that win-take. So it's easy for us to get that F&T share. What has been the NPA rate on the 7000 crores that you have dispersed so far?
00:20:05
Speaker
See, generally as a broker, I am not responsible for the NPS, but we keep on discussing with the banks. As of now, no bank has come back to us with any kind of red slack. So this means that even if there is a NPA, it's under their threshold limits. So that otherwise they would have told us that, you know, if the portfolio is getting bad and they might have blocked that ports with them. So it's not, it does not happen. So this means we are doing it right.
00:20:26
Speaker
Okay, got it, got it. And what is the financial benefit of being an LSP rather than a DSA? If you are an LSP to the bank, do you earn more? Yeah, definitely, because in a DSA, you are paid only once by the bank at the time of disbursement and then bank here. You said that disbursement happens in tranches, so you don't get paid for each chance?
00:20:52
Speaker
You are paid for the insurance, but that is only in construction link lag. So overall, tangents is for a FFTL and then suppose 10, 10, 10, 10, 10, five branches has happened. So overall, you're running one time on that FFTL.
00:21:06
Speaker
Okay. But, or if it is an innocent case of 20 lakh rupees, then you are paid only once by the banks. But in terms of, in our FFT arrangement, you can put your loan margin. So the bank will say that, okay, you have secured the loan book for me, but my minimum rate of interest at which I land is 10%.
00:21:25
Speaker
So now if I go out and walk in and I like to ask for a 12%, so whenever the EMI is collected, 10% will go to the bank, 2% will come to me. So there is a recurring revenue issue. So you'll get better margin. So you become a lender without having to go. Amazing. Okay. Okay. Okay. And I believe PTM is also using this approach, right, to build their... Yes, they are doing it in personal loans and many other products.
00:21:50
Speaker
Okay, interesting. What is the average spread here in FNDG? So we are currently working on those numbers. So we are actually working with the banks, we are finalizing these numbers. Obviously, we would like to be competitive as compared to other HFCs in the market. So we are competing with HFCs who are lending at our HFC. Housing Finance Company.
00:22:17
Speaker
So, in homelands it is not NBFC, it is HFC. So, it is a different type since. So, basically there are institutions in India who are lending at 18, 19, 20, 22 per se for water gauges.
00:22:31
Speaker
We want to compete with them. We believe their operations are inefficient because they lack technology. If you see that cost-to-income ratios, it can be up to 70, 80, 90%. So, really through technology, these cost-to-income ratios can be brought down and customers can be given the same loan which they're getting at 18%, at least 13, 14%, or maybe at 12%. We will reduce that OPEX for the buy.
00:22:55
Speaker
So, we are working with the banks that how much they will provide to us. In terms of name, we want to keep our name closer to 3%. Name is net interest margin. About 3%, 4% of our name, so that we are earning the same amount, which other exercises are named. But overall, we are lending at an overall. Amazing. Okay, that sounds fairly disruptive.
Impact of Low Mortgage Penetration in India
00:23:23
Speaker
Why is the cost more for traditional housing finance companies? Because they need people to go and collect documents and all that. You also need people to collect documents. What is the difference in the cost structure?
00:23:36
Speaker
Okay, see how a typical HFC works is that their operations are through branches. So whenever they want to expand to a geography, they will open 2-3 branches, they will hire a credit team, they will hire a sales team, they will hire an ops team, a hard suite team. Now, even if a customer comes or not, they have to be at those costs.
00:23:54
Speaker
And, you know, the second thing which happens is that they don't want to open branches in those areas where they don't have enough customers. So, you know, in PR3 cities or maybe in those remote locations where you don't have too much density of mortgages or too much penetration of mortgages, HFC will not refer to who there because they will not be able to cover their fixed costs, which is human costs, admin costs, you know, branch costs, those things. Now, our model is different. Whatever a branch is supposed to do,
00:24:22
Speaker
What we have done, we have actually created a distribution using technology and agents. So that the whole thing can be done, which our products do, through our mobile app, but then our agents. And these agents are paid only on this way. So I don't have anything fixed over there. It is all variable and technology obviously is variable and in fact lower than personal cost. So we believe that's the differentiation we have created.
00:24:49
Speaker
Now, even if I have to start a branch in a remote place in, say, Navalay, Dassam or somewhere, where Novanteg, I think, they have not reached too much over there. I just need a human being over there. He can download my app, he can download my app, and they can advise their customers.
00:25:07
Speaker
So I don't need a branch. So we can penetrate easily into PR2T as we said. We can be more profitable because we don't have any fixed cost. So that's the difference between us and the traditional awesome products. In fact, if you see, yeah, 70 or 80% of total home loan disbursements are done in the top five states. And if I go by 75 zeta, it will go to more than 10 seconds.
00:25:34
Speaker
And about 50% of this comes from Delhi and Mumbai only. So that's the skewness in the distribution of mortgages. Because people don't have branches in their locations.
00:25:46
Speaker
You had mentioned right at the beginning that our mortgage penetration rate is 10% which is much lower. What's the benchmark? So 10% of the GDP it is and if you see developed economies like US or UK, it's around 65%.
00:26:06
Speaker
See, whenever a mortgage is not just a loan, it actually is very beneficial for the economy. Because when a land is mortgaged, that piece of land comes into the formal economy. It has got a price. The government has got to know about it. And there is a whole society being built around it. So there is social promotion over there. Then the communities are built. There will be more people living over there. There will be more businesses over there. So the mortgage actually promotes the economy.
00:26:33
Speaker
So, mortgage penetration should be higher. In fact, if you see other Asian countries, in China, I guess it is around 30%. In Southeast Asian countries, it is again around 25-30-40%. And although it is close to 50% or 40%, but in India, it's very low. It's just 10%.
00:26:50
Speaker
Right. And I believe a lot of the Asian economies also experienced high growth purely because of the real estate and the lending group, like China especially, although now I think it's coming back to bite them, but it did contribute to their growth. They now have the ones who have to go to cities. Yeah, yeah, yeah. Okay. See, in India, that stage will come fairly young. The reason is people don't have houses here.
00:27:18
Speaker
governments, there is so much land available. We are like the several largest country in the world. And if you see here, we have 110, or in fact more housing finance companies in India. You name any business conglomerate, they will have housing finance business. Why? Because it's a profitable business, secure loan. In fact, if you see Mr. Adar Koonawala, the first business he started, or acquired after that set of institute, or after the COVID was announced.
00:27:45
Speaker
It's such a profitable business. Everyone is there. So people are sitting with money. They want to lend. And the customers need that money, but that gap is there, which we believe we are trying to build a bridge in that.
00:28:01
Speaker
Because it's asset backed and typically you don't see too much price swings in the real estate. And I think what happens is that these affordable housing norms are more secure. Why? Because for a person who is not that rich or a poor man, you know, whom is the only asset he creates in his whole life?
00:28:25
Speaker
Then he gave it to his children and he wasted their white hour. That's everything. But that's the only investment that building their life in. They might do a default in a personal loan because that default impacts that person only. But here his whole family will come on road. So he eats afterwards. First he eats his food. So it's affordable housing. And it's actually easy to repose as a whole property for one poor guy, where then for a person like Vijay Bali.
00:28:55
Speaker
Yeah, so true. So true. Yeah, that's the irony. Okay. So the reason for the low penetration in India, what is your saying that low ticket loans are not preferred. So there is not enough businesses who are going after low ticket loans. Then you also say that's
00:29:18
Speaker
not exactly what I said see actually low ticket affordable housing loans are part of priority sector lending in India and every bank means so many 40% of their books in that but they are not a you know profitable business because your direct economics is not good if you are a fixed cost model so see you earn the percentage of loan amount the more the ticket size the better you will earn now for a bank you know they are not able to meet their priority sector lending targets
00:29:46
Speaker
So, at the end of the year, they pay premiums to buy books from other HFCs. And that's the reason there are so many affordable housing products companies. Now, the problem is not that the particular child is small. The problem is that the penetration of branches in India is less. So, people actually don't want to build branches in those locations where mortgage penetration is low. Because for the initial period of the business, they will have to incur losses, which a band won't want to do.
00:30:12
Speaker
And the second reason is that traditionally in India, people have been afraid of mortgages. As you see, it's actually considered bad in India to go and mortgage your house or mortgage the board in your house. People will take a personal loan at 14-15%. They will not take a loan against property at 19% because it's considered as a taboo.
00:30:35
Speaker
But now with more I say education of people, people are coming and they are buying modules. It is actually increasing. It's growing at a keger of around 15-20%. And as per Mr Deepakwari, there was a news article last August in 2012 that in India, in next five to six years, there will be around $300 billion of new modules to be done. So it's such a major opportunity.
00:31:02
Speaker
The phrase mortgage and home loan are exactly the same. There is no difference between them. Home loan is a type of mortgage that in a home loan, you are mortgaging a house which you don't own. So you take a loan to buy that house. In a loan against property, you already own a house and you mortgage it and then you get the money and you can do anything with that money. So the use of proceeds is different. Okay. So mortgage includes both purchase of new house as well as loan against property. Yes.
00:31:30
Speaker
Got it. Okay. How much of your business is in which bucket? Like new houses versus loan against property? See loan against property is generally for business owners who need big ticket loans. So we actually wanted to solve the problem of a affordable house. So we focus more on home loans. So 90, 85, 90% of our business is home loans. And that's why we named the company Basic Home Loan. We wanted to focus on home loans only.
00:31:56
Speaker
LAP is something you exist in markets, a customer will come.
Addressing Lending Blind Spots with Technology
00:32:00
Speaker
And as a new company, as a broker, I can also go to the customer and whatever it is revenue generating. So we do it, but we consciously don't go out in market to find those customers.
00:32:12
Speaker
Got it. Okay. You said that products don't exist for some type of customer base. Give me some examples, like what are those blind spots where customers are unable to get loans, even though they might be good clinicians, but they are unable to get loans. So it generally exists on the property profile, like in India, not every property is registered. In fact, people avoid registries. So there are general power of autonomy, light of agreements.
00:32:41
Speaker
leasing for next 100 years, or maybe a Grampanjaya property, or Laldura property in around Maharashtra, those regions. And then, I think you're based on Bangalore, so in Bangalore you have Kathai, Kathavi, Kathasi, Kathadi, Sumeri, Kathau properties. So, not all are officially registered with, the agreements are registered with the government. So,
00:33:02
Speaker
go to London, will not want to lend on a property where it becomes difficult to repossess. So, like GTA, general power of autonomy property, generally lenders don't want to lend.
00:33:15
Speaker
or in Bangalore, as I mentioned, Kata B property, generally people don't do. Now, they eventually started, but these are the properties that people don't do. Recently, we had a case where our dentist was looking for a home loan. He was buying a GPA property. He got a loan at 17%.
00:33:34
Speaker
Think about it, he is the most cashish person. Even if he starts his job, he will get the best of us. He is getting a low rate of 17%. So if I go to that guy and tell him that okay, I didn't give it to you at 113%, I can acquire that customer with ease. So these are some of the angry.
00:33:49
Speaker
Why are you comfortable with these kind of not clean registration properties? Well, these are not clean answers that we are also putting a text and balances. So, what happens is that these properties are done, but done with more miss. So, small HFCs are contained.
00:34:08
Speaker
those HFCs who can take more risk, they end on those properties but at a very high rate, getting 90-20%, because they build it in their NPS. That okay, for a normal HFC, the NPS is 1%, we assume we will get around 4%, so they build it there. So, they do it, but the cost income is high as well.
00:34:27
Speaker
then eventually lending rate is very high. So we believe that we can reduce that cost to income to go to a percentage. And then even if they put the same kind of risk as in coverage over there, you are able to lend better. So that's the thing. Again, when you do a small ticket loan, then eventually it's the profile of customer which matters. It's the
00:34:54
Speaker
You can think of what talent will be known as a mortgage loan also, but as a personal loan also, which has additional security of a property.
00:35:04
Speaker
Okay, so it's not, so that's why we're starting with affordable housing loans. I'm not doing a one-car-out, two-car-out house, which is done on JPA. I'm doing it in small ticket loans, where you can think of the loans like a person with a business rent, which has original security of a property. And that property, I think you have done your checks and balances, and you put their risk coverage in your LPAs. That's what we are doing. Okay, very interesting.
00:35:28
Speaker
Okay, you mentioned a number of times about the cost-to-income ratio for lenders. Just help me understand, this income is the spread here, right? Like your cost of funds is 10% or 17%, so that's 7% that is your income. Like what is cost-to-income ratio?
00:35:49
Speaker
So income is the normal income you get after paying your, you know, the, the net interest margin into the loan, which you have. So it's the income you're earning and costs are the operational cost, not the provisioning costs and not the cost related to lending, but your general cost of operations for a bank, it would be the branch costs, it will a new one costs, SG and A, those kind of costs. Okay. And what's a good ratio to have?
00:36:17
Speaker
But generally if you see banks which are good, they generally have it around 30-40%. But does this mean that they are earning a margin of 70% on formulas? Is that the right way to understand this?
00:36:36
Speaker
So, if they are earning a margin of whatever margin they are earning, in that margin, the specialty is 30-40%, then they will have their NPA provisioning cost, then they will have their other tax and other costs also there. So, eventually they will land at a bit of 10-15-20%.
Integration with Digital Platforms for Enhanced Service
00:36:57
Speaker
So coming back to the way in which you are building this up, you said that there are four channels through which you acquire customers, online influencers, which is like the chartered accountants or neighborhood artists, and real estate developers who when they sell a property, then automatically your
00:37:19
Speaker
services are kind of upsold and then you said alliances. What is alliances here?
00:37:24
Speaker
So, you know, as you have, you know, offline influencers like the CA, you have digital companies who are influencing customers' decisions. So, you know, property portals or people who are advising customers on their financial management. We tie up with them. That is, you get any kind of customers whom you are advising. So, you can say it's a digital form of an influencer, but as a platform, you're tying up with them that you integrate our services with you. What's an example of you?
00:37:53
Speaker
can be you know we have not done it yet but for example 99 acres okay okay right right right yeah because people would start their research for a house on see we put our product in front of builders and these alliances like this that if you today start an e-commerce company you will not start building your own payment gateway you will just go and die up with a reservoir
00:38:17
Speaker
Okay, because you will get all the services. Because you know, if tomorrow, say Bombard of India launches something new like a UPI, it's not your core to build the real deal back. From your core is to sell your e-covers products. Similarly for a builder or these kind of online players, their core product is to sell houses or maybe something else. So they don't want to tie up with banks.
00:38:39
Speaker
They don't want to integrate with banks. They don't want to create technology around mortgages. So we are like a mortgage gateway that their customer checks out on our platform. Instead of taking money from the customer, they provide the mortgages. So that's the right analogy.
00:38:54
Speaker
Amazing, amazing. I love this checkout platform as an idea. This could possibly do like a 3x4x for you, right, in terms of the opportunity. Yeah, it works well for us. So for a builder, what we do is we tell the builder, integrate us in your CRM, or we will give our app to your sales team. Whenever a customer books a property, our PPM will be called, and you can send me that data, and customers will get a message that a basic representative will call you to help
Scaling Operations and Geographic Expansion
00:39:23
Speaker
you in your work.
00:39:23
Speaker
So you get a seamless experience for that customer that he applied and he has been asked for a mortgage, obviously when he has asked for a mortgage, so someone calls him. So that becomes a good experience for the customer. Okay. Amazing. Amazing. Okay. So this from 1000 crore of, so you're currently able to serve 20% of your demand. What's an ideal percentage that you want to serve?
00:39:50
Speaker
I believe that out of these 5000 crores, we can very easily disburse close to 2000 or 2700 crores. Because those 1500 crores of more customers, they are good customers. It's not only that I don't have product, there are other inefficiencies also in our system. We are also building a company. So sometimes what happens is I don't have geographically coverage over here. We are in 30 cities as of now.
00:40:11
Speaker
So, I am present, say, in Chandigarh. So, I can cover Zeratpur, I can cover Mohali. But if I get currently a customer in Murad, I'll have to leave that customer. So, if we are expanding our cities also, by the end of this year, our target is to reach 75 cities. So, then we'll be able to cater to those customers also.
00:40:32
Speaker
So those are some things which we are building and it will take some time that we reach that thing. But yeah, one thing is good that the product which we have built through which we qualify the customer to the right bank, we have built it on the credit policies of the bank.
00:40:49
Speaker
So when we started, we thought that we are no one to tell the bank that this is the right customer for you. So rather, that's their job. So rather take their credit policy, digitize it. So we actually create a credit assessment level and then compare it across the event and then show the recommendations. Now this system works very well for us if a customer has applied on my platform. So from login state to sentence state, our ratio is more than 75%.
00:41:16
Speaker
We give this guarantee to our customers that if in two occasions we are not able to get you a home loan, we'll pay your first CMI if you get it from somewhere else. So we are probably one of the few who are the only fintech company in India which gives guarantee of their job. No other platform will give you this guarantee. And this guarantee you would give only to people whom you qualify, right? You would not give this to everybody who applies.
00:41:43
Speaker
Yeah, so when a customer comes, my agent or my platform shows them offer. So I tell them if there is no offer, I cannot do anything. But if there is an offer, then I will try first with a back. If it is not done, then as my ratio is 75%, I try again with the second back. And then it should definitely be done. Because, you know, customer also has to be a login fee to the bank when they apply. So I don't want to waste their money.
00:42:12
Speaker
So, when you apply to a bank for a loan, bank after
00:42:19
Speaker
For some, you know, upfront payment, which is generally called login fee or IMD, initial money deposit, something or processing fee, there are different names to it. But see, back is not like a startup that they will give goodies to their customers. They, you know, they will take money for each and everything they are doing. So if a person is actually evaluating your application, even if it is rejected, there is a time spent on it. So where is that money?
00:42:45
Speaker
Ah, right, right, right. Okay, I understand. Yeah, for the operational cost of the credit evaluation and all of that. Yes. Now, here again, I'd like to stop. You see, this fate in RF and DG model will be done three of cost. Why? Because I'll be doing it through technology. I'll be qualifying using my own engine, which we call it product visibility metrics, which are entirely. So I will not be using a human being over there.
00:43:11
Speaker
So that's the benefit to the handy customer, that you can check your eligibility with me, free of cost, rather than paying me something first. So obviously, even if they apply to any other HFC or bag in the market, they can check it for free. So I'll get the rest of them. Because in your FNDG, it's virtually your book, like not actually, but virtually it's like your book. Yes. Okay. Interesting.
Future Goals and Expansion Plans
00:43:39
Speaker
Interesting. Okay.
00:43:40
Speaker
One way to increase this coverage of those additional 1500 crores that you are currently letting go is FLDG. You want to also be a lender, build your own book, become an agency yourself.
00:43:57
Speaker
So that's the end goal. We want to become a bank eventually. We have big goals. In next 10 years, we'll be one of the biggest banks in India, hopefully. So we started as a broker because one day when if I go to a bank and tell him that, okay, give me some money I want to lend or any other investor that give me some money I want to lend, who will trust me? No one. So what we did, we started with distribution as a broker and that was our step one. And there we are now getting 5,000 crores of customers every month.
00:44:23
Speaker
So now when I went to go to bank and tell them that they gave me a book, they don't ask me whether you are a foreshitter or business or not. I have business. Now they ask me what is your credit capabilities. So now I am learning credit with FLDs. Post which I will enter into whole lending and then eventually HFC and then eventually multiple other products.
00:44:42
Speaker
So it's simple that, you know, you have a big father or you have to prove yourself, you are proving yourself. And it helps us also because lending a business is a double-edged sword.
00:44:58
Speaker
As in, if I don't work out there, it will cut you also. So we are also learning along the way. In progress, I have zero risk. In fact, I have risk of that deposit. In co-lending, my risk will slightly increase. And eventually, I will become an exception. We learn along the way. So that's also good for us. And again, we have to make a business in 10 years, a good business, not keep those type of product. We have to sell it to someone. We are building it for a long term. How do you build a housing finance company? You know, which is essentially your roadmap. So just tell me about that process.
00:45:27
Speaker
See, the idea is that currently we are doing FITG, then we'll take a license to do co-lending, and in co-lending, we'll further learn more about credit and various risk functions, and then eventually we'll take a complete risk on our own book. But in a co-lending setup, again, you can have some book of your own as you have the license. The license generally costs around 20 crores because you need to show a stack of that too.
00:45:56
Speaker
So you have to do that. And again, when we started, we didn't have that much money. So eventually, the problem was we were not able to get a license. Now we've raised some money to do the authenticity versus ability to see which we are building is successful.
00:46:11
Speaker
Then we can go in market and show that we have a profitable growth rate. We have built our lending capabilities. We need money because we have created an engine. We just need to grow it further. Then we will take some more money and take our own license. Regarding capital, capital is easily available. It's not that difficult because at the end of the day, even if I do loans at 14-15%, these are secured by mortgages. So it's a kind of secured returns and giving to investors.
00:46:40
Speaker
It's better than every, it's better than government boards. People will make restricted to lend money. And what I've seen that in market, you can leverage the capital you have, you can raise more money, or you can issue bond papers. For a housing, business capital is not difficult to get. The more difficult thing is to get the right customers. By the way, we have sold already. We have a platform where customer is coming. We need capital to give it to them.
00:47:11
Speaker
Okay, okay, okay. And I guess, generally they say like one is to four, one is to five kind of a ratio, like the equity to debt for a lending business is what is acceptable, ideal, rather. Yeah, so currently, if you see, we don't have any debt, we are doing FNBG.
00:47:31
Speaker
So, there we are putting some equity here. So, if you see in a different way that I have put my equity of 5 quarts in the FNDG, so our equity rate ratio would be close to 20X. So, we are doing it with, I think that this equity rate ratio will be more visible once we start our own lending to our own book. But in an FNDG model, that's not required.
00:48:00
Speaker
So, you said that you are profitable like are you emitter positive or define what that means when you say you are profitable.
00:48:08
Speaker
So we have different levels of profitability, which we monitored since beginning. We have CM1, which is post the payment we make to our agents, then CM2, post the payment of our salaries, and CM3 after a marketing cost, and then the post a fixed cost. Since the beginning, we were always CM3 positive. We never, on a human technology basis, we never burned money.
00:48:29
Speaker
We didn't do business where we were, you know, earning money. Now, last year, with our scale, we are able to cover our face course also. And since March onwards, we have become a winter positive. Amazing. Amazing. And this is purely because of the fact that you are in an asset-like model. You don't have any rent costs. You don't have any salary costs for the field executives. Yeah. Yeah.
00:48:54
Speaker
and obviously technology because a lot of things which people do manually in a housing finance company, they don't make no technical work. The idea is that for an HFC also, it's not like they cannot reduce technology. The idea is that it's such a lucrative market, it's not a push market, it's a pull market. That's what I'll show you.
00:49:15
Speaker
for a home loan, and you're charging a higher rate of interest, they're opening it. Within here, people are getting a business loan at around 35-40%. So, in 19%, we sell that over. They are okay with that. So, people don't put efforts. If you see these small housing trans companies, they don't want to name them. Some of them we work with. If you go to their website, they don't even have a CTO. They have a chief IT officer.
00:49:41
Speaker
So orientation is not like that if you want to build technology while getting customers. So if they want to expand business, they'll start to go to grants, no worries. But eventually, for the betterment of the customer, or you can say, since it's such a big opportunity, some players like us, there would come in the market, we'll digitize it, and we'll take it away from that.
00:50:02
Speaker
The same thing which happened in the taxi industry. They made a certain model and the incumbent player at that time was charging so much. Their rates went down. It's the same kind of thesis. Yeah, one man's margin is another man's opportunity.
Industry Landscape and Competitive Strategies
00:50:21
Speaker
Yeah.
00:50:23
Speaker
Okay, amazing. Help me understand this industry as a whole. So, you are doing about 12,000 crores or 15,000 crores of this person this year. How would that compare with other companies? Who would be bigger than you? Who would be smaller than you? Where would you rank in the industry?
00:50:46
Speaker
See, when this industry started for home loans or any kind of other loans, people were mostly starting web aggregators. See, web aggregator business is good for, you know, playing with products like credit cards or personal loans or the products that people need in their emergency. Like if you have some medical emergency, you will take a personal loan, you will not care about the rate of interest.
00:51:07
Speaker
You want to plan some prep, you need money, it's a short-term loan, you don't care about ROIs. But for a home loan, these web regulators were not that successful. And the reason is because this is a product where people want to deliberate, they want to talk to others, they want to have the right advice. So a person who has just got barrier is planning to buy a house.
00:51:28
Speaker
He will not just take any home loan. He can wait for a year. He can wait for the right home to come in front of him. And, you know, Spandara Sanuski marries Rayalaya, but whom not right? Even if he left, he will have to wait a year.
00:51:44
Speaker
That's right. Gosh, that guy has to think about it. And that decision cannot be taken through a web portal. You need a person sitting with you. That's why this industry was dominated a lot by DSA's. But the problem with DSA is that they are flabbergasted operators.
00:52:03
Speaker
They don't care about the right deal for the customers, but they care about their margins. So, on every small stage, then we go to the customers and give me 1000 rupees more, I have to get this property paper, stamp paper, give me 2000 rupees more, I want to procure this or that. Or for a small customer, like a customer who is taking a loan for 10 lakhs or 20 lakh rupees, then they charge their loan processing. They try it out. They go to just 10, while in the DSA, telling you, you need a loan of 10 lakh rupees. They say, I'll charge my 3% off rent.
00:52:32
Speaker
We have a real case. In Jaipur, we disbursed the loan for 15 lakh rupees. Now the customer come back to my team and say, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees, you are supposed to have 15 lakh rupees,
00:52:56
Speaker
I'll say it was not regulated. See, unfortunately in India, if you see, if a person has to do insurance, become an insurance agent, they have to tie up with or have to register with the IRDA for a mutual funds if he exists. But no, there is no regulatory body.
00:53:11
Speaker
So any DSA can charge anything, they can miss sell, they can do anything. So that thing I believe, again the industry was dominated by DSA's. What we were trying to do is, and we were trying to give customers the same DSA's, but we were asking them to follow steps according to our app. We tell our customers upfront through our app, through notifications, if anyone is charging you money, let us know. We give you one EMI3.
00:53:38
Speaker
So those kind of things we have done that so the customer is benefited. So in a way we are organizing that DSA industry also by gamifying their experience who are.
00:53:48
Speaker
Now, if I again compare it with Ola Roober, if I take 20 years back from here, what was the problem of the texting line? The texting line will be roamed here and there to find the customer. If he gets the customer and he needs a longer ride, he will not go with the waiter. And he will not give a good experience to the customer. Same is the problem with DSA marketing. The agent needs a big ticket to the customer. They will charge unnecessary cost to the customer and experience is totally bad.
00:54:18
Speaker
All I know were never created any new tech scenes. For the same tech scene drivers, they created a new experience for the customers. That's what we are doing. We are just organizing this industry. Can we coordinate a pseudo-regulator for these deals? And they can do that because we are not aggregating their customers. We are providing them customers. We are providing them new business. So that is the reason they listen to us. They follow the steps in the app. They do it in a proper way.
00:54:46
Speaker
Okay, yeah, I'm guessing that at 12-15,000 crore dispersal, you would already be the biggest DSA in the country? Or are there other VAs? No, we are not. There are traditional business houses. They have been established in India for the past 30-35 years. They are doing close to, I guess, 2000 crores a month. So that's why I said that. As a DSA. 2000 crores as a DSA. Would I have heard these names? Any names?
00:55:15
Speaker
See, that's the, I don't want to name here, but yeah, see, that's the irony. That's the drawback in their business model. They are doing so much, but you won't have heard their name. Why? Because they are not originating their customers. They are asking small DSS to aggregate. And now these small DSS don't allow them to even talk to their customer because they are afraid that these customers will be taken away from them.
00:55:39
Speaker
So, you know, today, these vintage companies, even though they are burning money, they are creating a brand image, brand name, in financial services, industry, brand is everything. Because you're dealing with money, you're dealing with people's money, you're dealing with bank's money. So if you don't have a good name,
00:55:55
Speaker
the growth will be hampered. But these aggregators or traditional DSA models, their customers don't even know which you must... I'm very sure you would be getting calls on the SDFC. They will say, I'm calling on behalf of SDFC. They will not say what roles. So that on behalf is actually a DSA.
00:56:22
Speaker
Right. Okay. Got it. It also means from the HDFC or any other bank. So that's what they do. They are not able to tell their name to the customer. So this is the problem on the branding side, which we are solving through our app, through our interaction with customer, we tell them that, okay, we are helping you in your home loan. You sit at home. My agent will do everything. So that's again a differentiation, which you agree. Okay. Okay. Got it. Amazing. How big is your team?
00:56:52
Speaker
So we are now around 450 members in our team. In that we have around 250 people in sales. These guys are spread across 30 cities. Their job is to acquire these agents or DSS to whom we give our leads. And then they train them, then they help them on a daily basis for any kind of issues or problems as well.
00:57:17
Speaker
and the others. So 250 out of 400 are safe. Remaining are primarily in technology. We have a small call center also because when we get the customer on our platform, a courtesy call goes and we try to understand their problem. And then, accordingly, we assign them the agent that will work on your application. So we have around 50, 60 people in call center. And then people are around
00:57:47
Speaker
20 odd people in technology, and then we're in other various functions. And I'm guessing that you would not need to, if these are team size too much, even when you are at say 2000 crores monthly dispersal, you know, that's it. We will have to increase it, but not that much. See, whenever we start a city, we need to have a city manager and two, three people under them. And that because not because of operation demand rate.
00:58:13
Speaker
That is only because the agent wants to have a face. Because in India, counterparty risk is high. So if I give an application to a customer to fulfill, he will not do it until he is sure that he had his money. So he needs some kind of presence and eventually he can go away with those things. Okay. What happens when you open a city, like say you go to a small city, like say Avritsar, what would you do there?
00:58:42
Speaker
So first thing is we hire a city manager and two, three people under them. Then we liaise with banks so that we get permission to do business and then branches over there. And then obviously the first thing is to acquire agents and customers. So then these people under that city manager, their job is to go to market, acquire these agents and tell them that how to do the business with us. And then we imperil these agents and we start giving it to them.
00:59:12
Speaker
What about, you know, some sort of asset check that whether this Amritsar has good quality assets, what should be the right property value for that? Like how do you do that when you go to a new city? Like how do you learn about property prices and quality of assets in that city?
00:59:32
Speaker
So for that, you know, the data is available on RBI website. The RBI published the statistics that how different cities are performing. Take that data and then we go to RERA website. If you go to RERA, you get the new projects to be launched in each city list that what come upon projects are coming. So you get to know what will be the demand in the city.
00:59:52
Speaker
So from there we have made a list of top 100 cities in India where we want to expand first. So first we went to first 30 cities and then again in some cities it becomes easier for us to expand. Like, you know, we follow our event spoke model. So we have three hubs in India, the Red Sea, Delhi, Mumbai and Bangalore. And we expand really as a spot over there. So if I'm in Bangalore, it's easier for me to expand to Vysore. It's easier for me to expand to Bangalore. Now we started Chennai in 2-3 months back.
01:00:20
Speaker
So from Chennai, we are expanding to other, you know, Tamil Nadu cities, we are expanding to Coaching. Even though some of these cities are not in the top 100 or, you know, top right things, but it's easier to expand because my team is over there. So it's a mix of strategy that we deploy. And again, as I told you, it's a very regional industry. So I sit in North, so I might not be too good in the South operations. So we have our business head in South, who's sitting in Bangalore. So he makes a strategy. I just have to, you know, back him for that.
Entrepreneurial Learnings and Leadership Development
01:00:49
Speaker
Okay, my last question to you, what are your learnings while building basic?
01:00:56
Speaker
See, the biggest learning I had is that while I was working in other companies for five years, I always wanted to start something. In fact, in 2012, I started something after leaving my job, which was on the lines of Urban Clear, but I was not able to make it successful. It was two years before Urban Clear. So I was really afraid that if I start something, you know, I'm married also, I will solve all the problems while I get the money. So now the biggest learning is that if you have a good idea,
01:01:24
Speaker
There is a lot of capital available in India. Even if you don't get capital, start with good people, because you don't have to solve all the problems. You have to solve the first few problems, then you will get good people to solve very many problems. So make a good team. So that's something which now, you know, it don't work out, suppose something bad happens. I might not even try to go for a new job. You know, I try to build something new because I learned that, you know,
01:01:49
Speaker
problem, looks like a big problem, but you have to break it down into parts, you solve the first few parts, and then other people will solve it for you. Then, you know, what is your teamwork? See, I started working as an investment banker. And even though you have teams and investment banks, it's more like the individual contribution kind of job.
01:02:08
Speaker
So, but when you are managing a single stream of 400 people, not to sustain equal and other team members, and then you have 8,000 agents. So it becomes, you know, very crucial that how you communicate. So in the beginning, when I started in this industrial design in 1516, I...
01:02:26
Speaker
got a lot of backlash because I said something, it propagated something else to a person who is at a relationship level, a relationship manager level, and he thought about it in a different way. So you become more experienced at how to handle, how to manage expectations, how to talk to people.
01:02:44
Speaker
That's something good. And obviously the third thing which I have learned and more than my investment banking job, at that time also I was raising money for other companies, but now I'm raising it for my company. So I've learned how to present your business better, how to, you know, explain it in a simple form. Like I was giving a lot of examples in our talk also, the taxi driver, those things. So I've learned it along the way that, you know, it's not always to go into integrity, it's better to tell it like a story or some examples. So I think I've learned a lot along this journey.
01:03:15
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.