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Rajesh Jain (Netcore Cloud) on How to Bootstrap a SaaS Company to $100M Revenue
1 Playsin 15 minutes
Most founders chase venture capital like oxygen, but the man who pulled off India's first major dot-com exit built a bootstrapped SaaS company to over $100M in revenue without a single growth round. He also argues that $500 billion of global ad spend is being set on fire every year, and that marketing as we know it is quietly broken.
The man behind India's first internet portal, Rajesh Jain sold IndiaWorld to Sify for $115 million in 1999, a deal he closed in 15 days at 166 times revenue, just before the dot-com bubble burst. He then spent nearly a decade failing at everything before turning Netcore Cloud into a full-stack MarTech platform now serving 6,500+ brands across 40 countries, helping them retain customers across email, WhatsApp, and AI-driven personalization.
Across this conversation with host Akshay Datt, Rajesh explains why 90% of marketing budgets go to acquisition while customers quietly churn, why he runs his company like an autocracy rather than a democracy, and how MarTech AI agents and "AI twins" will reshape customer retention marketing. As the AI boom draws constant comparisons to 1999, hearing from a founder who survived one bubble and is now betting on the next makes this especially timely.
👉How Rajesh Jain sold IndiaWorld to Sify for a $115 million acquisition in just 15 days, and why timing the exit mattered more than building the business
👉Why he calls $500 billion of global digital ad spend pure waste, with 90% of marketing budgets going to acquisition and only 10% to retention
👉What it actually takes to build a bootstrapped SaaS company to $100M+ revenue without VC, and why he says Netcore is "funded by its customers"
👉How MarTech AI agents, a "Co-Marketer," and consumer "AI twins" will change customer retention marketing over the next few years
👉Why Rajesh failed at nearly everything for 7 years after his dot-com exit, and the lesson he learned about chasing technology instead of problems
Subscribe to Founder Thesis for weekly founder conversations and follow Akshay Datt on LinkedIn [https://www.linkedin.com/in/akshaydatt] for daily insights.
00:00 - Born for the Nation: Origin Story
02:04 - From Civil Engineering to Computers
05:55 - IIT Bombay to Columbia University
09:48 - Two Years Inside US Telecom
13:08 - Returning to India to Build
14:09 - The Failures Before India Internet Pioneer
16:02 - The IndiaWorld Idea That Worked
24:50 - Building India's First Internet Portal
38:44 - The $115 Million Dot-Com Exit
49:43 - Why He Never Became a VC
50:53 - How Netcore Cloud Started
57:32 - The SMS Business That Got Killed
01:05:00 - From CPaaS to MarTech Pivot
01:11:00 - The AdTech Tax Wasting Billions
01:22:43 - How MarTech AI Agents Work
01:27:50 - AI Twins and Customer Retention Marketing
01:35:00 - Bootstrapped SaaS Company With Zero VC
01:45:49 - Outcome-Based Pricing for MarTech
02:06:09 - The Man Who Helped Elect a PM
#RajeshJain #NetcoreCloud #FounderThesis #AkshayDatt #IndiaWorld #Sify #BootstrappedStartup #MarTech #SaaSIndia #IndianStartups #DotComExit #CustomerRetention #AIagents #MarketingAutomation #StartupFounderIndia #HowToBootstrapSaaS #IndiaInternetHistory #B2BSaaS #ProfitableStartup #aiinmarketing
Disclaimer: The views expressed are those of the speaker, not necessarily the channel
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Transcript
Rajesh Jain's Historic Exit and Entrepreneurial Beginnings
00:00:00
Speaker
I failed at everything I tried. You had like one of the biggest exits in Asia for India World set of properties, 115 million acquisition. Sifi paid me 115 million for India World. That same night, their NASDAQ listed stock went up by 700 million dollars. More important than knowing when to enter a business is knowing when to exit a business.
00:00:21
Speaker
Rajesh Jain started one of the country's first internet companies in the 90s and today he runs Netcore. business he's grown to $100 million dollars in revenue without ever taking outside money. On this episode of Founder Thesis with Akshay Dutt, they get into the dot-com deal that put him on the map and why he thinks 60-70% of the marketing budgets are being wasted.
00:00:42
Speaker
Companies are not democracies. Think of them more like North Korea or in China. Rajesh, welcome to Founder Thesis Podcast.
Rajesh's Journey: From Engineering to Entrepreneurship
00:00:49
Speaker
It's an honor to interview you. Not many people would know you
00:00:56
Speaker
are you the man responsible for the election of prime minister modi
00:01:07
Speaker
rajesh welcome to the founder thesis podcast it's an honor to interview you not many people who know you are a pioneer in India's internet space. um Before we get into that, you know what kind of and India did you grow up in? How did you end up in the US? s just Just take me through a little bit of your origin story.
00:01:29
Speaker
Sure. So I was born on 15th August, 1967. Oh, wow. and When I was a little old to understand, my mom said that the nurse who was there in the hospital had told her that in Marathi, that effectively translated was that this boy has been born for the nation.
00:01:55
Speaker
ah For lots of people on 15th August. um So I grew up in um in Mumbai and We were, I would say, middle class family at that time. My mom used to tell me stories later how she would walk with me in her arms from one bus stop to another because she could then save five paise on the bus fare.
00:02:21
Speaker
ask Early memories are essentially growing up in Mahim in Mumbai. And the that India was effectively, if you see the late...
00:02:37
Speaker
60s, more like the 70s India, ah you know where where there was a struggle for a lot of things, scarcity. um But what I do remember is that my father always tried different things.
00:02:51
Speaker
ah He had spent a few years in Dubai and that was the heyday of Dubai construction. ah The first iteration, what we have if you leave aside what's happened in the last few years. He was a civil engineer. I would walk with him to buildings. He was so ah the structural engineer for many skyscrapers being built in India. It was a unique tech that he had brought back from his stint in the US.
00:03:18
Speaker
So, early days i always thought I would be like my father, a civil engineer.
The Birth and Growth of IndiaWorld
00:03:23
Speaker
Build bridges. Those are the types of books I would see at home. um The school was St. Michael's in Maheem and then we moved to Nepenthesi Road in Mumbai. um My father did I think a couple of smart things.
00:03:38
Speaker
ah he In the buildings and the office buildings that he was constructing, he he took a flat and an office in lieu of his fees. And that appreciated a lot more. Absolutely.
00:03:50
Speaker
um So, St. Xavier's was the school where I spent eight years in St. Xavier's College after that. But this was an India where it was, you know, there was always this um ah yeah angle around, you never had enough actually.
00:04:11
Speaker
So the late 70s, early 80s, your options as a kid growing up was primarily either an engineer or a doctor. You had to study very hard because education was the only way you could sort of ah scale up in life.
00:04:26
Speaker
ah My father had grown up in a village in Rajasthan and he got a Tata scholarship to go to the US and that's how he pulled his family out from sort of low income, poverty, that kind of stuff.
00:04:39
Speaker
He's the person who really got educated in his family. um And so for us, when I was growing up, he would get a lot of magazines, international magazines from abroad, because he always felt that education and learning, constant learning is what got him out.
00:04:55
Speaker
And that's the sort of gateway or a passport to a better future. um So that was the 70s, early eighty s academically focused. um I would study a lot, not much of extracurricular activities in life other than perhaps quizzing, which I got interested in in my school and a little bit in college, math, standard tech, engineering interests at that time.
00:05:19
Speaker
How did you end up in the US? So four years at IIT Bombay, undergrad, i everyone there was aspirational, um of course, in that era.
00:05:31
Speaker
um no And what was interesting was also that ah a lot of kids at that time, I mean, all of us really, the only thing was that, of course, jobs available in India, but everyone aspirational was to get to the US.
00:05:48
Speaker
ah So I think in my batch pretty much everyone of electrical engineering, almost everyone except a handful would have gone abroad. Many are of course still there. Very few came back.
00:06:00
Speaker
So 84 to 88 was IIT Bombay. And then I applied. and I got into two universities. And I chose Columbia ah for my master's.
00:06:11
Speaker
And when I left, my father told me that, look, you are going to finish your master's in nine months. Work for two years in the US and come back. but That is exactly what he had done in the mid-60s.
00:06:24
Speaker
So for me, the decision to come back to India was already done. So, but the education in Colombia offered a nine-month... You could finish finish actually in nine months because it didn't require a thesis. So, you just take courses, finish it. And this was a computer science... It was actually double-E, electrical engineering.
00:06:43
Speaker
But I took a lot of courses in computer science because I'd never learned computer science before that. And... the In fact, in IIT, the only programming course was Fortran, which everyone had to learn at that time.
00:06:57
Speaker
that But what I had done was and when I was in 11th and 12th, my father had bought a computer in his office. Now, if you think back, it was such an
Challenges and Successes in Monetizing IndiaWorld
00:07:08
Speaker
important, that was a game changing decision in my life, I think. Till that time, I was all civil engineering, built bridges and buildings and whatever else.
00:07:15
Speaker
um But after college, eleven then especially 11th standard, I would go to his office and he had no idea how to use it. So I taught myself basic programming and then I would spend time on it. It was like this computer which took up a whole room at that time.
00:07:32
Speaker
um of i would i just fell in love with programming because it was not much else I could do. So I would make various games. ah But I fell in love with the idea that you could write software and control actions of a machine.
00:07:49
Speaker
But IIT, I never got the option to actually learn in this. So when I went to US, I was very clear that I wanted to take up at least some courses in computer science department. And that was the flexibility that the many of the US universities actually give you.
00:08:07
Speaker
And one of the first courses I took up was actually operating systems. And my advisor, they had told me that, look, it requires a prerequisite in C and Unix. And you don't have that. I can't let you take the course.
00:08:22
Speaker
So I told him, I said, look, give me two, three weeks. I will learn it. But I'm going to only be here for two um two or little bit more semesters. I've got to take this because then this is a prereq for some couple of other courses in CS, which I wanted to do.
00:08:36
Speaker
My first test in the OS operating systems course, I got two out of 20. This is not going to work. I said, one more test. I mean, let me give me give me a little bit of more time. I spent in that semester, I would have spent 80% of my time on a single course.
00:08:53
Speaker
And I ended up number two in the class in that course. um And I think that was sort of the foundational stuff for me to move away from civil engineering to more towards computers.
00:09:08
Speaker
um I think my dad's computer plus the experience at Columbia, I think was very, very
Navigating the Dot-Com Bubble and Strategic Exit
00:09:13
Speaker
helpful. And where did you work? You worked there for two years, right? I worked for two years. um It was a very tough time actually getting a job. This was 89 summer in the US.
00:09:26
Speaker
um I remember, I mean, there were not many jobs, especially on andmen on not whenual when you're on a foreign visa, it's that much harder as it is now. um So up I applied a lot. It took me three months.
00:09:40
Speaker
um I would go to all sorts of places for interviews. But i only got one job which was at 9X, which was the Bell operating company, one of the regional Bell operating companies, so telecom basically.
00:09:53
Speaker
So when I got a, and those were the days of of voicemails. um she's So I got a voicemail from 9X that my manager-to-be said that, ah please call me back.
00:10:09
Speaker
And I had been struggling for three months to get a job. I called him back and he said, look, we are delighted to offer you. And I said, I accept. He said, don't you want to know your your compensation and the package?
00:10:22
Speaker
I said, no, I don't care what it is. time You tell me when to start work. So that that was sort of those days. I mean, choices were limited. But in a way, you know, each of these then becomes sort of turning points.
00:10:35
Speaker
in your life. And those two years that I spent at 9X in White Plains, about 30, 40 miles from New York, were I think just fantastic. It was a science and technology center, so a lot of R&D.
00:10:47
Speaker
um I started off doing writing software, but they realized I could speak well. So they would then send me to meet various companies for doing partnerships So for to Cisco to Lotus at that time, I got to travel a lot. I got to do presentations. I got to be at conferences, events.
Building Netcore: From Linux Servers to Martech Leader
00:11:06
Speaker
So a lot of learning happened. Unlike a lot of colleagues or my classmates who ended up doing a desk job. And I would see others, in fact, even at 9x doing just a desk job. But I got the external facing world, external facing work.
00:11:20
Speaker
which I think was very exciting. Otherwise, you know, you end up just being on front of a computer all the time. And that helped a lot. That made me much more outgoing also.
00:11:32
Speaker
ah And I got to travel quite a bit before I was coming to India. um my One of my dreams was to take the train coast to coast. So I had gone to my manager and said, look, you know, it's going to cost the same, but if you give me one day off for a meeting in California, I can leave on Thursday evening.
00:11:49
Speaker
And I'll reach there Sunday evening. But i can I can do one of my and dreams. He allowed that, of course. So, it was a fun time. um lot of learning. But I would say it was more of the learning outside um the the office than inside the office.
00:12:06
Speaker
like Like you got to see the ecosystem of technology companies in the US. I mean, going to conferences, just being in presentations with senior 9x people at companies. i mean, you've got to see how they present, how they talk, how they converse.
00:12:22
Speaker
ah but Otherwise, it was very rare for an engineer at that age, at 22, 23, 24, to actually get in the late 80s. So you came back to India and you didn't look for a job then. You you wanted to just be an entrepreneur. You were pretty clear on that.
00:12:39
Speaker
Yeah, so that I was clear on because I'd seen my father through multiple ups and downs being an entrepreneur. And I was pretty clear I didn't want to work for anyone else once I came back. So there was a friend of mine, Sanjay Jain.
00:12:53
Speaker
He and i had connected in the US. He was a year senior to me from IIT Bombay, but we had not known each other here. a couple of friends had put us in touch saying that, look, both of you want to go back to India.
00:13:04
Speaker
And that's how... The entrepreneurial journey sort of began ah just around the time when I was leaving the US. We did some work for a US company. We had connected in order to bring that software development back to India.
00:13:19
Speaker
That didn't pan out much after that, but the entrepreneurial journey began.
The Evolution of Netcore's Offerings and MarTech Focus
00:13:23
Speaker
So in mid-92, I was back in India, um all said to be an entrepreneur.
00:13:30
Speaker
And ah like what were the lessons from that, ah like, you know, the those early attempts? So in the first ah two and a half years, everything I tried failed.
00:13:43
Speaker
So okay um we tried to do software development. We tried to resell American software in India. We created a multimedia database. week I spent a lot of time building a image processing software to sell to doctors and metallurgy companies.
00:14:00
Speaker
ah but none of them worked. I realized that the software we had built build ah called Image Workbench, at that time I didn't understand tenders, but all these purchases had to happen through government ah are tenders.
00:14:14
Speaker
And the rendering time used to be two years. And I realized I can't survive two years without an order. ah That didn't work out. up And then sort of it hit me that...
00:14:27
Speaker
I know when I came back from the US, I was God's gift to India in that sense, you know, that um great education, India abroad. ah And what really hit me was when people in the extended family would tell my father that, look, your son educated in the US.
00:14:49
Speaker
He is not earning any money. He is just losing you money. And our son may not be educated, but at least he is making money even if he is sitting in a shop or running on the shop floor. Now, father to his credit never brought any of these things up.
00:15:02
Speaker
Never said I should try and be with him. We are a small for civil engineering consulting unit. He said do what you want. And late 1994, I realized that the last venture imaging venture that I was doing has to die. it's not going to work.
00:15:23
Speaker
So then i And I had also got married, just got married, arranged marriage. The first year, i would barely talk to my wife because i was struggling at work. I hardly knew her. um It's almost like everything that was going wrong was going wrong in life.
00:15:41
Speaker
Then I went late 1994 to the US. um I spent a couple of months at a friend's place in California. i had a few ideas. So one of the good things was was that because my father would get a lot of magazines at home, for international magazines, would be expensive, but I would get to read the Fortune and the Business Week and those kinds of publications, if I remember correctly.
00:16:06
Speaker
I got a good sense of what's happening globally. And I could see the internet stories starting to come. So this was mid to late 1994.
00:16:18
Speaker
And I connected that then with some of my ah ah stay in the US where I was struggling to get information on India. I wanted to come back to India.
00:16:29
Speaker
I would get my parents to actually send me some of these computer magazines ah by courier to the US so I could understand what was happening in India. and I realized that the internet could actually connect Indians worldwide, could be this bridge, break geography, you know the death of distance as was called also at that time.
00:16:53
Speaker
And what was ah interesting also is that this connection that NRIs worldwide had a common problem. They had no idea what was happening in India.
00:17:04
Speaker
i mean, you would go to the library at say Columbia University, papers, new york Times of India, e etc. would take 10-15 days to come. ah India today was published only once every fortnight. By the time you got it, news was already 15 days old.
00:17:17
Speaker
So, the only option at that time was some of these ah Usenet news groups um which were there, but very sketchy in information. So, I combined the information emergence along with my own hunger for information on India and my belief that there will be many others like me and I spoke to a few friends saying you know what what do what are the kinds of things you would like, what are the things you miss about India
The Role of AI in Transforming MarTech
00:17:44
Speaker
and that then became the sort of genesis for the ideas which helped me build India world.
00:17:52
Speaker
But the real game changer I think in my life was at that time when I was struggling also in the US September-October 1994 I came across this book Competing for the Future by C.K. Prahlad and and When I read the book, I could almost see the business plan forming in my head.
00:18:18
Speaker
Even today I have a copy of the book with probably 100 post-its outlining the India world ideas. So I would read something, ideas would come, I would stick it in the book. And that sort of was the business plan being formed right there.
00:18:33
Speaker
And then, you know, amazing coincidence, I had gone to meet a person who had i've been introduced to, Professor Ramesh Jain in San Diego. So I go to him and um I had that book with me. I was reading it on the flight um and I showed him the book and he said, Rajesh, guess who was sitting here three hours ago? Okay.
00:18:55
Speaker
okay So, I mean, they were very good friends and it was almost like you know destiny prodding me in a direction where this whole idea of competing for the future that you have to imagine, there are multiple image visions of the future competing and you have to imagine that future and make that happen.
00:19:15
Speaker
So for me, The ideas is sort of germinated there. I came back to India. I had to reduce staff at that time.
00:19:26
Speaker
And I started on the India world journey. It was nothing to do with computers in that sense, nothing to do with tech. It was a media company. i didn't realize it at that time. I think it was good because i would have probably very scared. Obviously building a media company.
00:19:42
Speaker
The two things I knew that I wanted to have on India world were Lakshman cartoons and and India Today. That's what people had told me. That's what they missed most.
00:19:55
Speaker
I wrote out probably a hundred letters to media owners in India. Just physical letters. I got a letter back from R.K. Lakshman.
00:20:06
Speaker
I met him. And Times of India people were very surprised that... I mean, I was like a i mean random person he was meeting. They said, we sit close by and we don't get to meet with him.
00:20:17
Speaker
um And actually, when I went to meet with him, I told him, look, your cartoons will appear like this on the internet. Arun Puri and Raj Chengappa from India today met with me at that time. And I think I'm eternally thankful because some of these really became the content pillars.
00:20:35
Speaker
I mean, amateur katha, comics, comics. um which were also there. So a lot of small, small things put together at about 25, 30 sections became a portal. And these publishers were expecting some revenue?
00:20:49
Speaker
Initially, everyone gave it to me for free. um The good thing was I would basically show them, look, this is how your your content will appear on the internet. <unk>able Globally, people can access it.
00:21:02
Speaker
And up at that time, it was the time of TV channels. So for many people, it was like yet another TV channel opening up.
00:21:13
Speaker
Satellite TV basically. The Gershon was the only one till of course that time in India. And you know later on, of course, we had to start paying some of the content providers.
00:21:23
Speaker
But ah the good thing was that early on, I could begin with, because had very limited money. i mean, I'd lost some money in the two years. This was your ah US savings that you were using?
00:21:34
Speaker
questions Exactly. I have a question. So the ah image processing idea which you had was also a vision of the future.
00:21:46
Speaker
ah Why was this vision of the future more compelling to you? but Was it just that ah with image processing, you knew time to revenue is long? oh Very good point, actually. um When I think back now, i think...
00:22:03
Speaker
the attraction of a B2C business. Of course, we didn't know all these terms at that time.
00:22:10
Speaker
I think also the fact that I was building it for people like me. The imaging process felt like building for something else, for someone else, a hospital, a metallurgy firm, um x-rays.
00:22:24
Speaker
It just seemed very exciting that you could take images, enhance them, count objects and images. um But at the same time, the challenge was also that I was selling to people I did not know.
00:22:37
Speaker
Here, these were Indians. I mean, just like me. You understood the problem area better. Absolutely. understood the problem very well. And… It was early days and very early days of the internet. Commercial internet access in India came six months after I actually launched.
00:22:55
Speaker
I launched in um um ah March 1995. Commercial access in India came in August 1995. What does that mean, commercial access? like Like to consumers? Is that what you say? This is on consumer. So till that time, till August 1995, the internet access in India was largely through net, the educational and research net.
00:23:15
Speaker
You found some way to access the internet through ERnet to publish. yeah But then the government realized there had some clause of um not allowing ah education and research network, the ERnet to be used for commercial purposes. They deemed that I was doing it for commercial purposes. So they stopped. They cut my connection.
00:23:34
Speaker
Okay. The next day i had to now start dialing the US to upload the information on a US server. Okay. So essentially from like 10 rupees a day, it went to like 1000 rupees a day.
00:23:47
Speaker
tried to persuade them that look, there are many other institutions in India using ERnet, but of course you couldn't get through to anyone there. And even buying the domain would have been impossible from India, right? You would have probably had to buy it from the US.
00:24:01
Speaker
I had to connect with a person in the US um ah and and get the indiaworld.com domain at that time, which became a problem later on. As in it wasn't in your name?
00:24:13
Speaker
That's why. No, it was in the name of the US person. So we lost it later on. I was not being able at that time. had to restart. So we started with, but that's a story comes about a year and a half afterwards.
00:24:27
Speaker
Yeah, just take me through that journey. Okay, so you launched it. You started getting traffic, I assume. Yeah, so I realized i had to make money. So I had priced it. So I had kept a few sections free. Okay. Okay.
00:24:40
Speaker
So, but we yeah I put a price of $59 a year for access to India world. And ah how did that money reach India? That again, something am curious about. We are keeping it in the US right now for so hosting purposes.
00:24:54
Speaker
Okay. That was an entity I was working with in the US for this. It would cover at least their costs. oh what So two things happened. One is I realized that feedback came very quickly that look, we don't want to pay you $60 a year.
00:25:09
Speaker
So I dropped that down to $20 a year. And i started we started getting subscriptions online, people paying by credit card. But how did discovery happen? Word of mouth.
00:25:19
Speaker
Word of mouth. Absolutely. So we never did. I put up one ad in India Today International. I put out, I think, one press release through Business Wire and that's it.
00:25:33
Speaker
well And that was one very big learning for me, Akshay, that because even later on, as people would spend a lot of money on on their prop portals, which they would launch in India. For me, the learning was that, look, paid money can get a person to the side once, but it's only the content which will keep that person coming back again and again and again.
00:25:54
Speaker
I wanted India world to be a habit in people's lives. So we would update it every day, news headlines. ah We had an email a service which would say we would send out morning and evening.
00:26:07
Speaker
So my wife and I, my wife Bhavna and I, we of course built all this together. oh We couldn't go out together because one of us had to be sitting watching Doordarshan, listening to All in India Radio at night. but And then from the computer, basically he sent out the new books.
00:26:22
Speaker
But this rigorous discipline, effectively endeared us to Indians in the US. So it was absolutely right. was all word of mouth. I'm wondering how you managed to get married without an income. Like that itself was a challenge in those days, I'm sure.
00:26:37
Speaker
Yeah, this was lucky I got married before I was doing India World. but Okay. And my wife, we have worked together for 30 plus years. oh And everything that we've done, she's an equal partner, actually. but it is So, the...
00:26:56
Speaker
the news headlines, the comics, if there were updates every day which were happening. So there was a reason for people to come back again and again. And because we were the first, I think for about a year, we were the only ones. Read-Ev launched in 96, early 96. We were the only one.
00:27:13
Speaker
And the interesting thing was that on every page I had this button which said, if you need anything, send us feedback. I would read every email, I would reply to every email which came. The best ideas on what people wanted actually came from them themselves.
00:27:30
Speaker
So some short stories on India. So then I went to Katha at that time. Katha used to publish stories. So I would then, depending on the inputs which would come, I would then find equivalent content providers who would give me that.
00:27:45
Speaker
So people wanted stock stock market updates daily. So I got the stock market update from DSP, Merrill Lynch, I would get it on a floppy end of the day and then we would upload it. But they would still get it when they woke up in the morning.
00:27:59
Speaker
I mean, if you think about it, the gap was between not having anything and what what service we were providing. yeah yeah yeah Yeah, it was a different time. yeah And of course, cricket scores, cricket updates, all of those things started coming in.
00:28:13
Speaker
So, other source of um revenue in India that I generated was doing websites for companies. Okay, services. Services, exactly. So, I would persuade companies that, look, the internet is the next big thing. You need to have a presence on the internet.
00:28:30
Speaker
So, O&M, Ogilvy and Mather and Boyden were my first two customers. So we randomly charged 5,000 rupees a page, did three pages for them, 15,000 rupees. Sounds crazy right now.
00:28:44
Speaker
um My first big customer was Kotak, Kotak Securities. We got a we full platform. We did a personalized portfolio for them. Imagine 1996. You could have a personal portfolio with all the software it etc all done.
00:28:59
Speaker
So lots of these things then started happening. oh And then the advantage also was that I would then ah in the early days, I started then taking telling them that look you've created the portal but you need to publicize it.
00:29:12
Speaker
So we started running small ads for them and we started charging for them. Amul was another one. They were in the World Cup in um the 96, I think, if I'm not mistaken.
00:29:24
Speaker
And ah i said, look, your topical can be seen by everyone globally. So they actually paid for being present. So a lot of these small, small things helped get us, get the revenue stream going in India.
00:29:37
Speaker
or The US side got funded with the subscriptions in the early 18 odd months. Okay. and So you said after 18 months, there was that problem of the India world domain.
00:29:48
Speaker
Yeah. the We lost the domain. So I had to restart almost. oh I tried indiaworld.co.in and that didn't really work very well. You know, that co.in thing was not there. i had to host a server in India. Even today,.co.in will not work.
00:30:07
Speaker
Yeah. oh So we had to host a server from India because we lost access to the US server. So, um yeah, so now look at how things work out actually. i mean, this is like, there are so many people, I mean, thankful to life for making this happen. Now I keep saying as an entrepreneur, there are hundreds of moments in your life when you are one a little tiny second away from failure.
00:30:34
Speaker
a million things really have to go right for you to succeed eventually. You know, people think it's overnight success. No, it's like you avoided failure probably more than others to have succeeded.
00:30:45
Speaker
so So true, so true. So ah when I wanted to host in India, I tried i contacted Dr. Ramani, who was head of NCST, who was NCST used to host or run ERnet.
00:30:58
Speaker
He said, look, we can't allow servers, but why don't you go and talk to VSNL? Vidhya Sanchar Nigam Limited. They were a government owned entity at that time. And there were two people there who were instrumental in getting my server up and running within, I would say, less than 24 hours.
00:31:18
Speaker
That is so incredible. I mean, they didn't have a policy. This is a government institution. They had to keep me a domain. They had to give me space.
00:31:29
Speaker
I was the first customer for a server, really. There was Neeraj Sonkar and Amitabh Kumar. When you say space here, you mean physical space, not cloud space.
00:31:40
Speaker
No, no, no. This is, you I had to take a computer and and put it in their premises. Yeah, yeah, yeah. They didn't have any policy. But they did all of that. And they said, we'll figure out the policy later. You need, you have a problem.
00:31:52
Speaker
I mean, this is like when you think about, I'm just a random entrepreneur. um going to them, the government institution going out of their way to actually help me get get continue as an entrepreneur. Otherwise, it was the end of story for me.
00:32:07
Speaker
What domain did you use then? So, this was late 96.
00:32:12
Speaker
Now, so we got the site up and running, but then I realized, you know, this indiaworld.co.in is not working. I tried indialine.com as a portal name. That also did not work very well.
00:32:24
Speaker
And in In a way many times out of adversity know comes some positive things. So Bhavna and I were... She is quite religious. So we had gone to a temple in early 1997 in Rajasthan.
00:32:42
Speaker
And on the way back from the temple to Jodhpur airport in the car we were just discussing you know this do domain problem. um No one's coming to our sides. And In that sort of two hour drive, we said why not try Indian names.
00:33:00
Speaker
So samachar.com, we thought of all of these names. So it was a very contrarian idea because Yahoo was the big daddy at that time. Yahoo had yahoo.com and everything else was a subsection under Yahoo.
00:33:16
Speaker
And here we were saying that, you know, let's break our size sections up into separate sites. So samachar.com, coach.com, khail.com. That's how we had we started thinking. We registered, I think, about 30 domains after we came back and to Bombay.
00:33:31
Speaker
And then I started launching these properties separately. And actually, that was the best thing to have happened for us. So out of probably the worst adversity of my life came the best decision.
00:33:43
Speaker
but Why was it so great? Like why did it turn out well? So, A, it eliminated one click. People didn't have to come to IndiaWorld.co.in and then go to a specific ah section that they wanted.
00:33:56
Speaker
And these names became very memorable. Even today people of my generation, I mean probably 60, 59, 60 those, eight I'm 59.
00:34:07
Speaker
But when people meet up, some of them still remember samachar.com, khail.com, khoch.com, bavarchi.com. We had 13 portals like this. Four worked, nine did not.
00:34:18
Speaker
But the four that worked did extraordinarily well. So Samachar became the news so homepage for Indians. We made a lot of money from advertising there.
00:34:29
Speaker
It single page site. We aggregated news links. um Kale.com was the click it site. So the model also changed to ad supported instead of subscription. Yeah. So after I lost the domain, domain I could not take money anymore.
00:34:43
Speaker
We had to just drop the subscription bit. We made everything free. And yeah by a late 96, early 97, also ads just started picking up. Yahoo making money from ads. i would just So what one thing I used to do is to go to all these internet conferences, Singapore, US,
00:34:59
Speaker
Hong Kong and you I would learn from what people are doing there. But there was very limited learnability in India. I mean we were pretty much ah the only entity doing things.
00:35:11
Speaker
So advertising started picking up there and we tried a lot of experiments. We tried a gifting service. We tried to make money from transactions. ah We also became a sub broker for ah banks for their new issues.
00:35:24
Speaker
There was resurgent India bonds a thing which had come at that time. And we had done our tech tweak which the RBI had agreed at that time that we could change the form number in a PDF on the fly.
00:35:39
Speaker
So everyone who downloaded the form could actually, um the form would be accepted because not the physical form, was the PDF which was being sent across. Now, I realized if I just did a software thing, I would get maybe 5,000 rupees from different brokers or finance companies for this.
00:35:58
Speaker
I got the idea that the to become a sub-broker. So I said in the firm, give me a code which makes me a sub-broker. So we got a percentage of the money that came in.
00:36:10
Speaker
So instead making maybe 50,000 rupees for from 10 companies, we made about, I think, I don't know, I forgot now, but 10 or 15, 20 lakhs. at that time. ah How were people investing? the Online payment?
00:36:22
Speaker
like or i mean Like a bank transfer or a swift? Yeah, those NRE, NRO accounts if you remember at that time. Ah, i well then robb fill All those letters i still exist.
00:36:33
Speaker
that Right, right, right. So NRIs, because the whole idea of research in India bond was to bring in NRI money into India. i think we had problems with the rupee dollar rate or something like that, if I remember. So all of those things actually worked out ah very well in hindsight.
00:36:49
Speaker
um And these are all small small decisions which may seem inexplicable. Now, i don't even remember how I would get the idea to make a decision like this. But as an entrepreneur, I keep you know saying it's never about aiming for success. It's about ah one more day that you live, you're one day further ahead from failure.
00:37:14
Speaker
Yeah. Yeah. One day closer to success. Yeah. One day closer to success. So, you know, you don't plan for success. and Most startups actually fail. So, but we kept trying. I mean, I would keep trying out things. We were 20 people in our company at that time running 200 corporate sites, 13 of our own sites, all packed in one small office in one point.
00:37:37
Speaker
So, you know, for listeners who may not be aware, so you had like one of the biggest exits in Asia for the India world set of properties, 115 million acquisition. ah When did that happen? How did, what led up to that?
00:37:53
Speaker
So that happened in late 99, 1999, about five years or so after I had started. i was constantly trying to raise money. Everyone else in that time, 97, 98, 98, 99, the internet boom had started in India. A lot of capital started flowing in.
00:38:09
Speaker
Like there was capital, like VC money flowing into India? Yeah, there was investments happening. Yes. So, I think there were a few VCs at that time who were investing. Rediff at least raised quite a bit of money.
00:38:24
Speaker
Ah, Rediff. Yes, that's right. Okay. ah and There was India.com which had been launched. So, a lot of different sites are getting launched at that time. Yeah, I remember India.com had a Times of India front page.
00:38:37
Speaker
Yeah. I-N-D-Y-A India. I-N-D-Y-A, yes. yeah And um so while I was trying to raise money, one advantage i had was I was profitable.
00:38:49
Speaker
I was not burning capital, even though we were very small, probably 2-3 crores or so at in revenue at that time. And how many eyeballs? So but I guess money raise would depend on eyeballs, right? i all All the multiplication used to happen in terms of eyeballs.
00:39:06
Speaker
we Samachar had about 4 million ah page views a month. If I'm now remembering correctly, it's a great question. Okay. which Which is pretty good. 4 million page views is pretty good.
00:39:18
Speaker
yeah And for us, what happened was Samachar was a single page site. It became the of default start page for Indians. So morning, evening, you just get the headlines all together on a single page, updated around the clock.
00:39:30
Speaker
And it was a bot which would do it. So in fact, think of it a precursor to Google News. had no human being doing any of the updates. Then a lot of page views, of course, on khal.com, khal.com, khal where every, all the updates, basically you could do a reload.
00:39:47
Speaker
You are updating it in real time. Khal's were updated in real time. Coach was a search engine. You launched the search engine. Yes. So, I copied Yahoo. Coach was a complete ah directory and a search engine. So, you crawl sites and then do the search on.
00:40:04
Speaker
So, I was trying to raise money but where we had got some offers. but But the reason or the motivation to raise money you was purely peer pressure.
00:40:15
Speaker
Like you saw Yahoo is raising money and all these dot-com companies are raising money. and Because if you were profitable, the pressure to raise money was not an internal pressure. Correct.
00:40:26
Speaker
So the reason to raise money was I realized two things. lot of them were spending on advertising. And I realized that maybe we also need to spend. You're exactly Peer pressure. Others were doing it. So maybe I had to do it.
00:40:37
Speaker
Also, I realized that if I have to even hire some people, no one will just join a small company without external funding at that time. if I built professional management.
00:40:48
Speaker
So at that time, um i started talking to a lot of potential investors in India and outside. So well and got a couple of term sheets also. um ah They didn't eventually materialize.
00:41:03
Speaker
But then what an interesting development happened was in, I think, September 1999, SIFI had gone public on NASDAQ. So they were in ISP. ah They were connecting the internet connections, dial-up connections, lease lines that started happening in India.
00:41:18
Speaker
And SIFI was very keen to do a AOL-like play. So content plus connectivity. So, but but one question. SIFI is Satyam InfoWay. This was connected to the Satyam software company, Hyderabad based.
00:41:34
Speaker
It started incubated as it were or initial funding came from Satyam. But then Satyam InfoWay was an independent company. It had its own um the CEO, MD, Ramraj, completely delinked in a way from Satyam's computer services at that time.
00:41:52
Speaker
Okay, okay.
00:41:55
Speaker
So, Sathya Infoway was the one which went and listed on NASDAQ. Because the Chinese companies had done very similar. the just um many Many Chinese… Alibaba… and No, Alibaba came later. It was Sina, cna cna Sohu, Nettys were all listing on the American on NASDAQ.
00:42:14
Speaker
This was like peak.com euphoria. Absolutely. they were like um so had raised 80 odd million dollars.
00:42:27
Speaker
And ah their banker was DSP Merrill Lynch. Merrill Lynch, but their Indian arm was DSP Merrill Lynch. And coincidentally, I had got a banker, ah a DSP Merrill Lynch.
00:42:40
Speaker
to help me raise capital. So they were trying to help me with H&Is raising about 10-20 crores at that time. And then SIFI had raised money. Their stock was going up every day on NASDAQ. That's what you what you said.
00:42:55
Speaker
The euphoria and the boom which was happening. And also ah I had got another offer at the same time from a US company, mail.com, which owned the domain india.com. So proper India, I-N-D-A.
00:43:12
Speaker
So they wanted to do a India play and they were looking to acquire a portal. And this was also NASDAQ listed, mail.com. yeah I think Mail.com, I was Nasdaq-less. That's how everyone was getting the money. i Yeah, yeah, yeah.
00:43:27
Speaker
Those were crazy days. yeah you so So, going from nowhere and struggling to raise any capital, in the space of effectively 10 days in October 1999, I had two competing offers.
00:43:45
Speaker
And in the space effectively of probably two or three weeks, The valuation went up from 13 million, 13 million to 40 million, then 70, 80, 215 million.
00:44:00
Speaker
Oh my God, that is phenomenal. Spudial. Right. i And the entire deal then got done in about effectively 15 days. you i mean, what due diligence do you do when you're paying 115 million for a company which was probably less than a million dollars? Yeah.
00:44:19
Speaker
Oh my God. ah What do you think ah led to this kind of decision-making? mean, this is not isolated decision-making. Like a lot of people burnt a lot of money on.coms. Like I think the most famous, like the pets.com or whatever those names are there, which burnt billions of investor money. What was leading to this euphoria? I mean, you've lived through it. I think you might have an interesting take.
00:44:48
Speaker
So, Effectively, it is ah if you look at the AI scene a little bit like now, yeah it was somewhat similar at that time.
00:44:59
Speaker
AI is being backed up of course by solid revenues now coming into companies. The internet at that time was on belief and hope, as many bubbles are. but That's how you get the good outcomes eventually from every bubble.
00:45:13
Speaker
Now, at that time, the metric really was traffic. Nasdaq was the place where companies were getting listed. So there was lot of capital available to companies.
00:45:27
Speaker
Sifi paid me paid 115 million for India World. That same night, their Nasdaq listed stock went up by 700 million dollars.
00:45:38
Speaker
Oh my god. Incredible. Okay. In the two months after the India World deal, SIFI's valuation went up from about $1 billion dollars to nearly about 7 or 8 or close to probably $10 billion. dollars Secondary, to raise money to pay me. So it was future money. So they effectively diluted probably 1 or 2%. People think they paid a lot, but look at what the markets were willing to fund at that time.
00:46:10
Speaker
Yeah, it it was an extremely good deal for them, right? I mean... pay 100 million and get a couple of billion bump in valuation. Yeah, and also, know there was ah I have to say this quote by Hemindra Bhai, Hemindra Kothari, who was the head of DSP Merrill Lynch.
00:46:26
Speaker
oh And I had, and went to him, they were my advisors. I went, I remember talking to him saying that, Hemindra Bhai, look, my wife and I have built this company for five years.
00:46:37
Speaker
You know, we don't want to sell it. and This is like our life. And he said, Radish, more important than knowing when to enter a business is knowing when to exit a business. He said, you will never get this kind of valuation again.
00:46:54
Speaker
You are a creator. You have ideas. You have imagination. Build some new things in life. This money will give you the freedom to do what you want in life. And this was an all cash deal. Yeah, it was started as an all cash deal. But later, as the markets fell, Siffy converted a part of it into stock.
00:47:12
Speaker
So I got some stock later on, but it was largely and all cash deal. Amazing. When did the markets turn? Like how how much time after the deal closed? Very quickly. So my deal happened in November 1999. I
00:47:28
Speaker
i think SIFI, I think the peak was ah February, March of 2000, if I'm not mistaken. And that's also when the AOL and Time Warner deal happened.
00:47:41
Speaker
Hmm. And I know my second tranche got paid in ah June 2000. And by that time, the markets had started falling fairly steeply. The correction had already started happening.
00:47:52
Speaker
So it was that small window which was there. Yes, amazing. You you couldn't have timed it better. yeah If I had missed that window, Akshay, I mean, you think about it. We were a 3 crore revenue company.
00:48:06
Speaker
And we got a deal which was 499 crores. 166 times revenue. well I think it would have been very difficult to get even probably a fraction of that amount and that.
00:48:19
Speaker
So that that's the story of the India world deal. Amazing. Amazing. So ah why didn't you become a VC after that? A lot of people in your position might have thought that, okay, let me invest in startups, etc., etc.
00:48:34
Speaker
are Like maybe was not a done thing then or what? Like I'm curious. Actually early 2000s there was not much of VC yet and in India. I mean there were a few global funds and I don't think there were too many Indian funds at that time.
00:48:50
Speaker
And I did try ah investing in companies a few years later, 2007, 8, 9 in about 15 odd startups. But then I realized that I am not the VC types.
00:49:03
Speaker
I am the entrepreneur. For me, the thrill and joy of building things from scratch, solving problems, irrespective of the outcome. I mean, I've probably failed 40 times in my life trying to solve different things in life.
00:49:15
Speaker
But then I realized I'm not the investor type. Even now, I don't do direct investing in startups. It's just a single company. um But I love doing different ideas, experiments forever Netcore, which i it is what I'm involved in now.
00:49:32
Speaker
How did Netcore start? So Netcore started the interesting story to it. ah Just ah around the time I was selling India World, we had this small side business in India World in the company where we were selling up Linux mail servers for companies.
00:49:48
Speaker
How that started was again listening to customers. When we started putting up websites, they started getting emails from NRIs. And they said, look, you know, we need to now route these mails internally. We need email IDs.
00:50:00
Speaker
And Microsoft Exchange was the only option at that time and very expensive of course. So we started setting up Linux based mail servers four companies open source main servers for companies, for companies.
00:50:15
Speaker
But then when I tried to raise money in India world at that time, I would get this question, okay, so you got this portals business and you got this site tech business. This is too confusing.
00:50:26
Speaker
I would then end up getting defensive very early on in the conversation. then I decided, okay, maybe best to separate the Linux business out. No one was interested in it anyways. And that then became the genesis for Netcore after I had sold India World.
00:50:42
Speaker
So, Netcore today is a lot more than a company setting up mail servers. Take me through that evolution. Sure. So, for the first 7 or 8 years after I sold India World, about 2006 or so, ah we were only doing mail servers.
00:51:00
Speaker
And I tried a lot of different ideas in there. This mail server, I just want to quickly explain. So this would like people who had Microsoft Outlook software on their desktop. So so they would configure Outlook so that the mails a hit on their Outlook software. Internal corporate mail.
00:51:18
Speaker
Internal corporate mail. So at your domain, you get a mail ID and then the mails would come to your mail server and then get routed to mailboxes. So Linux had an equivalent to Microsoft Exchange on the mail server side.
00:51:34
Speaker
And so we would start deploying that commercially look for companies. So that's how we started getting some money. and There was no UX layer in this, like an inbox where you log in. Yeah, the UX could be your same. windows Windows, I think, had an outlook.
00:51:49
Speaker
So you could use it with the mail server, absolutely. So what Microsoft would charge is for the server licenses. Okay. So the first seven odd years, Netcode just did not grow. We tried many different things, thin client, thick server.
00:52:04
Speaker
um I also invested in a company where we tried to build a $100 computer um with IIT Madras. So lots of these ideas. And of course, none of them really worked out. And then in 2000... Why didn't they work? Is there some through line?
00:52:19
Speaker
but ah I think um if I were to paraphrase it, in the you know in know book title which came out a few years ago, um essentially i was focused on the solution and not the problem.
00:52:37
Speaker
When I look back, every time that I have been enamoured and excited by the tech tech side of it, I tried to create tech in search of a solution, I failed.
00:52:50
Speaker
Image Workbench was enamored by the tech trying to find and outcome. all the A lot of these products, in ah we tried to create a sm a single ah and small business server for ah small businesses that were for small businesses at that time called Prajati. Lots of these things, 2000, 2007, I think failed.
00:53:09
Speaker
And then a friend of mine sat me down one day saying, Rajesh, look, you're good at coming up with ideas. You're completely lousy at trying to commercialize any of them. you need to get a CEO for your business who thinks very differently from you.
00:53:25
Speaker
And he had a recommendation now of a person I should at least meet. The first idea shocked me. know I thought I was, i had this history of the big success behind me, of course, long time ago, passing days passing by.
00:53:40
Speaker
um And then, but I did meet the person he recommended, Abhijat Saxena, and we hit it off quite well. I realized he's very different from me.
00:53:51
Speaker
And what we needed at that time was a way to take some of these ideas to commercialization. We need a business sense. So 2000, so you know the story is, great success in 99, next 7-8 years, I failed at everything I tried.
00:54:08
Speaker
So I was 2007, five, six, seven, i was ah probably a two one or two crore revenue company. But then we did start spotting new avenues at that time. So that's where the net core growth story begins with a new CEO.
00:54:23
Speaker
I was involved in the company, of course, but I was very clear that the decision maker is only one. You can't have two co-leaders. I keep telling people, i said, companies are not are not democracies. Think of them more like North Korea or China. You have to have one leader, but authoritarian, basically. Okay.
00:54:44
Speaker
Decision maker. So, that's where then we started. We started with enterprise SMS services and enterprise email services. Now, these were different from the mail server. Because we had the mail server, now companies like India Today, others used to collect email IDs, subscriptions, e etc. They said, look, we want send out newsletters of our own.
00:55:04
Speaker
And there was no easy way to do that. So then we created a simple solution. At that time, we called it EMM. So email mass mailing. So they could then send out emails at bulk without um without um crowding their own internal server, which was used for their enterprise traffic.
00:55:24
Speaker
This was a managed service or a product? These were, we didn't know at that time, but these were all operated from the go We didn't know the word cloud at that time. They were all operated on a server on the internet. That's how we would call it.
00:55:36
Speaker
so But it was basically the early days of the SaaS world. So they were all operated as services where we would charge not on our maintenance fee, but we would charge per email which was being sent.
00:55:51
Speaker
or per SMS which was being sent. So these then became sort of the monthly recurring revenue businesses, MR type services. So email and SMS, we still do both of them now.
00:56:04
Speaker
They are great ah revenue generators and profit generators for us. How did the idea for SMS come? Again, from customer needs, like you started with email, mass mail and then...
00:56:14
Speaker
SMS was interesting. actually did email started more from the customer need. SMS was growing in India at that time. So we created a ah a service called My Today SMS, which was actually a consumer service.
00:56:27
Speaker
So we told people that you set up a, you send a message, start news or start um ah cricket. And we would send you an SMS, 160 characters with updates.
00:56:43
Speaker
At that time, SMS cost was very tiny and we also had up our own SMS server at one of the telcos. So, for the fraction of a paise at that time to send an SMS. For telco, it's basically zero cost, literally, or zero incremental investment.
00:57:00
Speaker
And I thought I could replicate the India world type model of running an ad and then making revenue from attention. So, the service grew virally. So in less than a year, I had 4 million subscribers to these SMS services.
00:57:17
Speaker
um And we had 30 channels, so news, cricket, jokes, shairi, geeta, bible, all kinds of things. Was this the time when when those four, five-digit, like, you know, there was some four, four, four, four you send a message there. for And these these would typically be like, this was like the vast ah era of telecom, value-added services. There was some premium pricing you would pay.
00:57:41
Speaker
ah And that's how the people who are sending the content, the who are running the pipes would earn through that platform. But there was a difference here. People only had to send us a message once, start and or stop. Stop for unsubscribing.
00:57:55
Speaker
So they would only pay the premium pricing once. After that we were sending it to them for free, hoping to make money from the ads. But then what happened was two things happened.
00:58:08
Speaker
One is some of the telcos started realizing that this was competing with their vast services. So they started blocking our access to the shortcodes. and we ah We had to use what were called long codes, 10 digit codes at that time.
00:58:21
Speaker
But more devastatingly, the government then effectively put a, they increased the SMS pricing for businesses literally overnight from a fraction of a paise to 10 paise.
00:58:38
Speaker
So I was sending out 1 crore SMSs every day for these subscriptions that we had. Now the problem became that what would have actually be 1 lakh rupees a day now became 10 lakh rupees a day and I had to stop overnight.
00:58:58
Speaker
And that is the big learning I learned in my life that never build a business where you can be shut down by the government by a regulation change overnight. I mean, it was, you know, when you spend year and a half building out, you have people ah just spreading every day new subscriptions on their own.
00:59:17
Speaker
much popular subscription was actually Bible. You would send out a Bible would every morning at 5.30. It spread through churches.
00:59:25
Speaker
i mean, I can imagine in churches, people saying, okay, remove your phones, send a message, start Bible, God will speak to you every morning at 5.30. Almost like that. like that like true True virality it achieved.
00:59:39
Speaker
True virality, absolutely. So for me, both India World and my today SMS at that time were virality, were actually word of mouth, focused on the product. um And once we stopped that,
00:59:52
Speaker
I realized had to do something else. you know We had this SMS infra, etc. We had expertise. And then we started looking at a few companies already started looking at corporate services. Corporates wanted to send out these messages. So we will be repackaged or we focused our consumer platform for corporates.
01:00:10
Speaker
So that's how the SMS businesses started. but It's very interesting when you ask the stories. It's never a never a linear, you know, for entrepreneurs, it's never a linear path. It's not like I sat down one day, built a business plan, I'm going to create this thing. No, it's always, you come listening to customers, some problems.
01:00:31
Speaker
And I keep thinking many times in life, if my India world, if my image workbench product had worked, if I had got like 10 orders for those imaging platforms, I would never have done India world.
01:00:42
Speaker
If you hadn't lost the domain, you wouldn't have created all of those you all yeah yet some them. Absolutely. It's the constraints which define our journey at the end of the day.
01:00:54
Speaker
yeah ah That area was pretty interesting on the VAS side, right? that There were a lot of people making a lot of money on VAS, which was generally a ref share with the telcos. ah ah Why didn't you explore that?
01:01:07
Speaker
Well, telcos would pay very little. Okay. That was one. And I was probably more fascinated with the India world model that advertising could actually work.
01:01:20
Speaker
so um And we are started to get a few ads at that time. So the 160 characters would get split into 80 characters content, 80 characters ads. And my belief was that every company would have to build hotlines.
01:01:35
Speaker
no broadcast hotlines on SMS with their customers and the opt-in would be the great way to do. And we could do all of this bypassing the operator. I think in hindsight, that was also a mistake because this was a proprietary, in a way, operators controlled the platform. It was not a it run an open platform like the internet.
01:01:54
Speaker
Although WhatsApp is enabling this today, right? Yeah, but WhatsApp goes over on the data. So it's over the pop, as it were, the way it's working. Yeah. So WhatsApp did a phenomenal job.
01:02:06
Speaker
um I wish I had thought of that. It's one of those ideas. I mean, I think we were close. We wanted to do these of SMS groups. I think I was too caught up with this whole SMS thinking.
01:02:18
Speaker
Think of the data side of it and an app side of it. So maybe, um yeah, in a different universe, I would have done something like that.
01:02:30
Speaker
Yeah. Okay. Interesting. And ah like, you know, what kind of revenue started happening through the EMM service, the SMS service, like by 2010 or so, what what kind of revenue were you doing?
01:02:44
Speaker
ah It was a few crores. I don't remember the exact numbers now. But the revenues were starting to grow quite rapidly and so was profitability. So these were very profitable services.
01:02:56
Speaker
In email, i mean gross margins would run at 80 to 90% because all you had was data center costs. SMS, once you had the platform ready, of course, you are to pay for the SMS capacity. So the margins were typically not more than 25%.
01:03:12
Speaker
But at scale, you could actually do quite well. but you You could do very well. So but both those businesses started working well. We were doing, I think, a few crores, probably about 5-10 crores at that time ah by 2010-2012 or so. But we were profitable. That's important.
01:03:29
Speaker
And these were transactional messaging or promotional messaging? Mix of both. Mix of, okay. yeah It was a mix of both transactional, promotional messages.
01:03:40
Speaker
In email, a lot more promotional.
01:03:44
Speaker
SMS costs had started rising. But email costs, of course, for the last, I think, 20 years have stayed at roughly in the one-pice range. oh Right, yeah. So that worked out very well.
01:03:55
Speaker
And of course, all the other problems started coming in, SMS, spam. Then you had, of course, WhatsApp. Then you had other telco restrictions, all the restrictions of the government which came in. So in the industries have evolved.
01:04:07
Speaker
But the good news is even today, when you look back, and considering that we started all this in 2006, 7, 8, about 20 years ago, these are still very, very good businesses to run.
01:04:18
Speaker
i mean, email, i mean, we have while we are big in India, we've small footprint globally. up Email today is probably a 7-8 billion dollar market globally for oh ah for the transaction and marketing messages.
01:04:34
Speaker
and We do about 30-35 billion emails a month globally. So almost a billion emails every day. And SMSs in India, of course, have grown tremendously.
01:04:47
Speaker
You have RCS now, you have WhatsApp also. So the power of all of this is because of one simple idea which is push messaging. When a brand has a customer, how does a brand get a customer back to its properties?
01:05:03
Speaker
Either you remember, so it's phenomenal branding, but otherwise you need the push messages. And there are a handful of channels for push. Email is there, SMS is there, RCS is there, WhatsApp is there, WhatsApp is of course a lot more expensive.
01:05:19
Speaker
And if your app is if the app is installed, it's app notifications. For every brand, the power of push messaging is required to bring people back to their properties because that's where the transactions happen.
01:05:33
Speaker
So I don't think push will disappear. The channels will keep evolving. Channels will change and have changed to a certain extent. But these are very solid revenue generating, profit generating businesses globally.
01:05:45
Speaker
ah When did that evolution happen from CPaaS to MarTech? And let me just break this down for our listeners. So CPaaS is communications platform as a service. So like a Twilio, SendGrid, these are CPaaS companies which are providing the pipes through which brands can ah send out emails and messages to customers. ah MarTech is more like, say, Clevertap, MoEngage, these kind of businesses where they're problem they're solving is what you just described, ah how to retain customers, how to reduce churn, how to get repeat, how to increase the lifetime value of a customer that you have already acquired.
01:06:26
Speaker
um So when did that pivot happen from Netcore being CPaaS to Netcore being Martek? So 2014, twenty fourteen oh And I just ah finished off about six about four three four years working on the political side.
01:06:44
Speaker
um that's Which we will come to next. ah That's another chapter I want to get into. 2014, effectively, I was thinking of what to do next and a colleague of mine, Veer, he came up and said,
01:06:56
Speaker
Rajesh, I was meeting a customer and then she mentioned this word MarTech and then I tried to understand a little bit more and I looked it up. ah This is the next big thing. So we are doing the channels.
01:07:10
Speaker
What MarTech lets you do is to orchestrate all these journeys, creation of segments. So you can automate a lot of these sending of messages. And August of 2014, there was a first MarTech conference in the US, which both Veer and I went to.
01:07:27
Speaker
It was organized by Scott Brinker. um And that's where the genesis of the fact that MarTech is something which it can become the next layer on top. Because we were always worried.
01:07:40
Speaker
Every time we would go, what if SMS goes away, what if email goes away? And especially you would have seen the WhatsApp kind of apps like like today for consumer to consumer ah communication, nobody uses SMS, right? So that would have, you would have seen that change happening.
01:07:59
Speaker
No, WhatsApp started coming a lot later. Okay. ah This is 2014-15. So I think it was very early days, even for WhatsApp, if I'm not mistaken. okay Okay. I mean, metta before for Facebook, of course, was the big thing at that time.
01:08:12
Speaker
And then we started, ah once we came back, then we actually led the creation of the MarTech platform. And that became became began Netcode's journey into marketing automation.
01:08:24
Speaker
So for us, it was that you had the communications layer. Of course, you have the data storage which is happening. There's the data layer, there's the communications layer, and then there's the journey orchestration layer, the automation layer.
01:08:35
Speaker
You could create segments you could um um we had segments based on people's interests, demographics, actions, behavior. And then you could and not just broadcast to them, but you could also create journeys based on triggers. So I left an item in the shopping cart.
01:08:53
Speaker
if i have not completed the purchase, then automatically say in three hours or three days, a journey can be triggered to send me a specific message. That's, we all are recipients of these messages, but this is the backend of how all these things work.
01:09:09
Speaker
That's the world of marketing automation. What are the ah different stacks within MarTech? So one is, of course, the communication layer, which you explained. So by data layer, you're talking of like the the CRM or the CDP? Yes, absolutely right. So it's the CDP.
01:09:26
Speaker
So CDP, for my listeners, is customer data platform. How is CDP different from CRM, if you could just explain? CRM is the category. It's a customer relationship management category.
01:09:37
Speaker
So, Martech, web personalization, app personalization, all of this broadly comes under the CRM category. So, if you just pack up a little bit,
01:09:48
Speaker
If you think about marketing, digital marketing, it's essentially just two elements. It's about acquiring customers, which is largely done through the ad tech platforms. So Google, Meta, the ads that you see all over the internet, that's acquisition.
01:10:03
Speaker
Now, once a brand acquires a customer, acquires here would mean getting some sort of digital identity, either an email ID, a phone number, or an app install, in which case you have a direct ah relationship via the app.
01:10:19
Speaker
That is where the world of CRM and MarTech comes in. So what you are doing there is building relationships with existing customers. And of course, to build relationships, you have to have some identity information.
01:10:30
Speaker
So this is the retention side of it. So i get I get the acquisition done. I'm paying money to AdTech. ah platforms to get a person in.
01:10:41
Speaker
And then i have to maximize my lifetime value of that customer. And that is where the combination of push messages. So you have the you know the stack is you have the CDP, which is the data stack.
01:10:53
Speaker
Then you have the orchestration stack, where which is the marketing automation part comes in. So you have the um you have the journeys, the segmentation happening there.
01:11:04
Speaker
ah Then you have a personalization layer. So how can I, when you come on the site, if I know who you are, I can actually show you the right message so that you are more likely to do a transaction.
01:11:18
Speaker
So that's where the personalization piece starts to come in. The more the data, the better the personalization. Then you also have something called product experience, which are nudges.
01:11:30
Speaker
you Everyone would have seen those inside apps where the a spotlight comes on a specific action your so supposed the the brand wants you to actually look at. For example, in KYC, you have to complete the KYC process. You have to ah put some small money in there. not So they will nudge you in that direction.
01:11:48
Speaker
So lot of these now become elements in the broader CRM play. So there's one CRM which is the B2B side. What I am describing is the B2C side. B2B side, of course, you have the likes of HubSpot, Salesforce. Salesforce is everywhere.
01:12:04
Speaker
But Salesforce's original thing was on the B2B customer relationship management where market or brands, essentially, the salespeople are handling the marketing relationships for their points of contact at brands, the buyer side.
01:12:23
Speaker
But this is the B2C side, which is somewhat different. and much more exciting because you're dealing with millions of customers at any point of time. How do you personalize messages? How do you break them up into segments ah and so on?
01:12:37
Speaker
So the goal in marketing, in fact, I think is is very simple. How do I reduce as a marketer? How can i reduce my acquisition cost, which is called CAC, that yeah customer acquisition cost?
01:12:50
Speaker
And how do I maximize the lifetime value LTV of every customer? But that is really the spread. which is the most critical element which drives profitability for any B2C brand on the digital side.
01:13:02
Speaker
All other costs are impossible to control. let's your It's how much you're spending on marketing decides how profitable you are. But a repeat behavior comes in, maximizing lifetime value comes in, all of those elements start to play play up there OK, so ah the red reduce reducing CAC part, how does ah ah ah like a MarTech stack help in that?
01:13:29
Speaker
but I think CAC is a function of like, say, running ads on meta, Google, et cetera, and then optimizing those ads or what else is there for? Yeah, so this is my pet peeve in the world. So ah that what's really happening is that brands spend a lot of money on acquiring customers.
01:13:47
Speaker
Hmm. But they don't spend enough on building the relationships with them after they are acquired. Right. the The LTV, basically they they don't spend enough on increasing the LTV. okay So what's happening here?
01:14:02
Speaker
or The outcome of all of this is that the the the customer who is there becomes inactive, dormant and churns.
01:14:14
Speaker
The relationship is not being built by the brand. All we are getting are effectively offers, buy this, buy that, 10% off, 20% off. ah In many cases, the measures are not even relevant for us, not even personalized are to us.
01:14:29
Speaker
So now if you put all of this together, what's happening today, and this has sort of changed, of course, through the years, 90% of marketing budgets are spent on acquisition, 10% on retention,
01:14:43
Speaker
And 70 of the 90 is actually spent reacquiring the same customer again and again and again because brands are not building deep relationships. And for me, this 70 is actually ad waste. So of the ad industries, digital ad advertising $700 billion, dollars my estimate is that $500 billion dollars is being wasted.
01:15:08
Speaker
This is money which should actually be on the P&Ls of brands. which is on the P&Ls of the ad tech firms. I should point out here, ah there is a vested interest that you have here in this calculation because netcore is serving the LTV increase magnet courseru completely on the CPAS MarTech side and of course but let's go the LTV boosting side of the business I'll be happy by the way if it becomes more it's already
01:15:43
Speaker
Right, right, right. Okay. ah Okay, that's interesting. i did not know that it was so skewed. ah Is this just lazy marketers? So if you think about Martech, and this is, um I'm going to quote back what marketers have told me.
01:16:00
Speaker
Martech is hard work. You have to collect data from customers. You have to collect digital identities, email, mobile number. ah You have to then create campaigns on a literally on a daily basis. Then you go to execute the campaigns.
01:16:14
Speaker
Then you have to analyze what has happened on the campaigns, redo the whole content creation process. This is in their words, drudgery. On the other side, now compare the world of ad tech.
01:16:28
Speaker
You call up an agency. Here's my budget. Here are the clicks I need. Deliver those to me. Very simple. This is becoming even simpler now where Google and Meta are actually doing the even the content creation for you.
01:16:42
Speaker
AI is helping create the content, doing all the A-B testing at scale, massive scale, beyond what humans will be ever be able to do. So give us the budget. Tell us what you need.
01:16:52
Speaker
We will deliver it everything everything and you just sit back and relax. So there's that dopamine hit of ah like you turn on the tap of you're putting your card in and you start seeing revenue.
01:17:03
Speaker
Absolutely. AdTech delivers revenue from the next second onwards. AdTech is a slow process. You have to build relationships. Outcomes take a fair amount of time.
01:17:13
Speaker
You have to set your organization up from an infrastructure perspective, from a data collection perspective ah in order to make it work. Absolutely. And the challenge also is that in many of these cases, CEOs want growth right away.
01:17:34
Speaker
So for a marketer, is ah profitability is then not the question. You want growth? I'll deliver the growth. The easiest way to get growth is just increasing the budgets spent on on the ad tech platforms.
01:17:48
Speaker
Now what I tell marketers is that, look, this is like you're paying a tax on every transaction. You're literally paying a 20, 25% tax to the ad tech platforms on every transaction. Doing it once is fine, but doing it repeatedly will not help you on the path to profitability.
01:18:07
Speaker
The marketer's response, but am not tasked with profitability. My goal is growth and this what i deliver. So, what size of business... should start thinking about uh martic because it is not cheap uh you need at the very least you need somebody who understands it and that talent cannot be cheap i'm sure this would be like a 30 40 lakh annual salary kind of a resource at the very least that you would need uh so so what size of businesses does this make sense for like to invest in martic
01:18:43
Speaker
I think if you have, see there there are two challenges. For any startup, you will need some element of a Martech play. um because it's a given. i mean, you may still do just broadcast campaigns. You may not do that. That could be as simple as MailChimp. where You start with MailChimp or a SendGrid marketing platform so you can get going.
01:19:03
Speaker
It'll cost you maybe of tens of dollars up to $100 a month. So it's not a very large outlay in the beginning. But what you said is correct that you need a one you need at least one resource on to get this thing going.
01:19:17
Speaker
But as the business starts growing, say beyond say a crore a month for a D2C business, then what happens is you have to remember that now you're competing for your customers in an auction against every other D2C brand to get them onto your platform.
01:19:36
Speaker
So the way I like to phrase it is think of two nevers. How do you never lose customers and how do you never pay twice? What the never most customers means is what we talked earlier. How do you maximize the lifetime value of every customer who is coming in? That means when I get a relationship going with a customer, can I ask that customer a few questions? Can I get to know that customer a little better?
01:20:02
Speaker
Male, female, where they are where they stay? What are their interests if in travel? Do they like hills or do they like the beaches? Ask these questions. Very few brands actually ask us this.
01:20:15
Speaker
They are not building the hotlines with us. But there's friction in that, right? Like you you want know you want to give that dopamine hit to your customer also, right? That I just go to Amazon and I click buy and the product next day reaches. Or what like in quick commerce, that dopamine hit is even more instantaneous. Yeah. But how is the customer coming to your property?
01:20:36
Speaker
See, and but only if you think back, either you're on marketplaces, where again you're paying a tax to the marketplaces for your transaction, or you're opening them in from ad tech where again you're paying a tax.
01:20:50
Speaker
So the best D2C businesses are the ones who have very high retention rates.
Leveraging AI for Enhanced Customer Engagement
01:20:55
Speaker
Recurring revenue is very very important. Right, right. That LTV over CAC is how any VC evaluates D2C businesses. Absolutely.
01:21:04
Speaker
So over time, my belief is that the importance of MarTech and especially now with AI, where a lot of the frictions. So the frictions I spoke about earlier are all going to go away in the coming months.
01:21:17
Speaker
with the use of agents, AI agents. So you'll have segmentation agent, content agents, decisioning agents, what to send, ah to what to whom at what time. Actually, it's the messaging is very simple. What's the next best offer?
01:21:31
Speaker
So right message, right person, right time, right channel, all of this is… These core ideas have not changed. In fact, 30 years ago, there was a book which came out, The One-to-One Future, which talked of one-to-one personalization.
01:21:45
Speaker
I think finally now we can see that future coming up that marketers now should be able to spend more on the retention side of things and when I talk to marketers I keep saying I said very few marketers CMOs actually become CEOs this is your moment in time if you can think of yourself as the chief AI officer and the chief profitability officer of the company you can become the next CEO of the business because you are the custodian of the customer anyways.
01:22:19
Speaker
But today you are seen as more of a cost center rather than a profit center. Become the profit driver of the company and now you can make that leap to the corner office.
01:22:31
Speaker
For SMEs, will... ah Like, will this happen, what you're saying, of an agent tech, martech stack, or is this more of an enterprise product?
01:22:45
Speaker
No, I think it will start with the enterprise side because of the AI tech, which has to get done. But eventually, it will flow down, absolutely. In fact, today, if you look, you can run an entire acquisition side, the ad tech side of it, with effectively one person.
01:23:01
Speaker
You set up parameters on on ah on the ad tech platforms, and you're done. MarTech will be similar where effectively the way I think of it is that you will have a co-marketer helping the marketer.
01:23:15
Speaker
And the co-marketer, it's a net core term that we use, the co-marketer works with multiple agents. So that you are not just giving inputs but you are telling the goals. I want my sales on Rakhi or Valentine's Day or Mother's Day to go up this much.
01:23:31
Speaker
Who are the best customers to target? And AI is ah the agentic side of it will do um is is already doing actually a much better job on the decisioning side than what humans ever can.
01:23:43
Speaker
So in a way what's very interesting is when I when i talk to marketers about AI, I said look, there are two sides of it. There's the faster, better, cheaper, where you can automate some of the easy functions which are there in your marketing team. So content creation, copywriting, all of those things.
01:24:00
Speaker
But take up the impossible things. Let's say you have a million customers. How many segments will you create? If there was humans managing this, you'll create 10 segments. but you probably need a hundred segments and every segment then needs its own content.
01:24:16
Speaker
This is where the agentic layer will come in. And I genuinely believe that in the next year, we will be the beneficiaries as consumers, as customers, because we will get relevant messages coming to us.
01:24:30
Speaker
And that's really, that will help the brand because then we are not going shopping around all the time. We are not switching ourselves off from brands. which again forces them back into the world of ad tech, which leaves more money with brands for them to do product innovation.
01:24:44
Speaker
If EBITDA goes up 5 to 10 percentage points more, That's money which stays with the brand rather than going into ad waste.
01:24:55
Speaker
Okay. What is the tooling needed to make this work? Like, for example, you said it all starts with data to understand your customer. For example, like if I'm on Zomato, do generally order vegetarian or do I generally order non-vegetarian or whatever? ah pizza versus biryani.
01:25:13
Speaker
ah how How is this, all of this data captured and stored? And is Netcore providing a product to do this? Or do you integrate with other products and capture? Or like, how does that happen, the tooling?
01:25:27
Speaker
So this is exactly what Maantech platforms do. So what happens in the app is there is a piece of code, what we call the SDK, which essentially gets into the app and that then captures all the data and all the actions that you are doing which gets stored along with your demographic data and other data that you may be giving through forms and so on which gets combined.
01:25:50
Speaker
On the website similarly to the JavaScript a small piece of code on the website which captures all your ah all your actions. So what's happening is the CDP at the back end actually not only has your sort of static information but it's also got your demo ah your behavioral data.
01:26:09
Speaker
Now if you take this little further, imagine now the future systems actually can create twins of each one of us. They know where we stay, they know the weather,
01:26:22
Speaker
So they can in fact even target messaging to us based on time of day, on the weather outside, raining, not raining. Bangalore versus Mumbai, you know different messaging can be done.
01:26:34
Speaker
But this is beyond the capacity of humans to do it. And this is where I believe the future of MarTech lies in these AI twins.
Netcore's Comprehensive MarTech Platform and Market Strategy
01:26:44
Speaker
where each one of us as consumers will have an AI twin. I call them brand twins because they are in a way controlled by the brand. It's not us.
01:26:54
Speaker
It's not like an agent on the on our side of it. But that twin becomes the interface between the brand and us. It knows about us. We can talk to it in natural language.
01:27:06
Speaker
Today on most sites, you can't still type. You can't still, mean, you can speak, but ah you still can't do it in a, you still are doing keywords in most cases. I still can't say, hey, you know, um I'm in the mood for a for a legal thriller for two hours. I don't want to watch.
01:27:24
Speaker
Don't give me a long series. Ideally, I want a legal thriller set in India. Now, what are my options? You know what I watched in the past. Don't give me those. Right. Yeah, you cannot do this as of date. You can actually do some of this on a chat GPT or a Claude. Yes. And they'll give you better recommendations sometimes than what a Netflix or an Amazon Prime does.
01:27:44
Speaker
True. But this is where the opportunity is, I think. So this is the future, I think. And my belief is that the better the recommendations are, the better the relationship building is, the better the relevant content that they can give us, the brands can give us, the less we will be prone to moving away to others and the less they will then be spending to bring us back to their properties.
01:28:09
Speaker
So I think this is an inflection point really in the world of marketing. for so Most marketing is now digital. that the brands who execute this well, I think we will see a disproportionate increase in their profitability and their retention rates.
01:28:27
Speaker
Which earlier it was sort of a level playing field for everyone and therefore the more data that you collect, the more you are profitable and all the investments that you can make on new products etc start to happen. And this is where a marketer becomes critical. So a customer of Netcore does not need anything else. You provide the CDP. There is a CDP product of Netcore. There is a orchestration product of Netcore. These have different names or what? like Internally, can you tell me what are the product offerings?
01:28:55
Speaker
Effectively, it's all seen as a, we call it CE, Customer Engagement and Experience Platform. In that, there could be separate modules, say, for app personalization, web personalization.
01:29:07
Speaker
um So ah it's the the core idea is simple. It's basically journeys, segments, the CDP. So most smart tech platforms have a basic CDP already in place.
01:29:18
Speaker
The challenge happens when you have offline you have ah offline stores. also in which case you got to these then they become siloed because you typically have will have a separate system for an offline a system offline stores and therefore you go to then integrate the data together go to match that these are two of the same customers so that becomes a little more complex but for pure say d2c brands martech companies will provide the full stack the one additional piece which we have added which we did it through an acquisition four years ago unboxed this which enables
01:29:52
Speaker
a product discovery. So when you search on say e-commerce websites, how to make the search results relevant, how to make the browse pages relevant, how to do better recommendations.
01:30:04
Speaker
That is where a search and product discovery platform comes in. So broadly, if you see the layers are, there's the communications layer, which we discussed earlier, the CPaaS layer, email, WhatsApp, SMS, RCS, notifications.
01:30:19
Speaker
Then you have the tech layer, marketing automation, journey orchestration. And then you have the search and product discovery layer, which is more relevant for D2C type companies, e-com companies, e-com and retail companies, rather than the BFSI segment. For us, the two large categories, of course, are BFSI, banking, financial services, and insurance.
01:30:39
Speaker
And then you have the e-com. They're the two entities with the largest basis. Then you have, course, telecom, travel, all those companies start to come in. The key thing is, We need for companies like ours to work, we need an identity.
01:30:55
Speaker
So FMCG type companies who do not have identity information because they are operating through distributors, they don't become large customers of ours, of MarTech. They will do it for B2B base, the distributors, the wholesalers and the retailers which are there. But for us, we need the end customer identity information.
01:31:15
Speaker
Okay, got it, got it. Okay. ah ah How are you different from a CleverTap? And why I'm asking is because I've interviewed the CleverTap founder previously. Interestingly, they also came from a media company. They were in Network 18 before they started CleverTap.
01:31:30
Speaker
ah So some parallels there, but help me understand, is it very, very similar to what they offer or are there some fundamental differences? So the market layer that I spoke about is identical to say a CleverTap, more engaged,
01:31:46
Speaker
WebEngage, globally companies like Braze and Klaviyo and so on. Where Netcore's focus really has been is to integrate the other two elements also into a single stack. So the data flow becomes easier.
01:32:00
Speaker
So we also control our own channels. So email, SMS. We have direct telco relationships. We are our own email service provider. So it's an enables a lot of interesting things, send time optimization,
01:32:13
Speaker
ah How do you get better primary inboxing happening and so on? Which is, because other MarTech players have to rely on third party our platforms. And then of course, when we can bring in the search and product discovery, it helps with recommendations.
01:32:29
Speaker
So our belief is that the customer is the same. They are coming at you from multiple different angles. Every direction that every channel that they come in from is a is a data channel and a action channel.
01:32:42
Speaker
So you are collecting data, you have to get it all in one place and then in that split second, what is the best action, what is the best offer that I can give to a customer?
01:32:55
Speaker
The greater the control that you have across the stack, the better can be the recommendations and the messaging that can be done. That's really where we start out. Okay, okay, okay. Understood. Okay. oh You, I believe, spent almost $100 million dollars on the Unboxed acquisition?
01:33:14
Speaker
Yes. About $100 million, about four years ago, yes. Okay. ah Can you help me understand? the You must have rationalized it internally to the board that this is why this investment is worth it. This is how it's going to boost our revenue or whatever. Just if you can help me understand.
01:33:30
Speaker
So, Unboxed basically had two advantages. Number one is that it was an adjacent product. So basically did search product discover like i explained just now.
01:33:43
Speaker
So it effectively leverages the relationship with the same brand, the same ah customer, I mean our customer, not the end, our client as it were, not the end customer, number one.
01:33:58
Speaker
So that was ah that we realized that that could be a good add-on product to be able to sell into the same buying center. And the second was that a lot of unboxed customers were in US and a few in Europe.
01:34:10
Speaker
Now we have been trying to also get into these markets for a long time because they are much bigger markets in India. i mean US s I would say is overall for the spaces that we have discussed is probably 50 times bigger.
01:34:22
Speaker
Europe would be at least 10-20 times larger. And in US, Europe, the developed markets, it is very hard to build organically. to build a presence organically requires either a ton of money, the spending on marketing, etc.
01:34:37
Speaker
Or a good way is to look at an acquisition. You get a footprint, you get some brand recognition because Unboxed had been at i'd been around for a long time, a few years at events, people knew them and so on.
01:34:50
Speaker
So you could then build on that. They are the Gartner-Forester relationships also, which very important for enterprise buyers. on And that is where for us, that was the rationale for the acquisition.
01:35:03
Speaker
That you get an adjacent play plus you get a starting footprint, a better starting footprint and you save time for the developed markets.
01:35:14
Speaker
Okay, so like new customers plus increase in your average contract values because you're selling an additional product. How much has it contributed revenue wise? Like what's been the lift?
01:35:27
Speaker
So Unboxed um is roughly about, ah are non I'd say about 12-13% of our revenue today. So that's a for significant contribution. more in more ah More importantly, it's very high quality revenue because it comes from developed markets.
01:35:44
Speaker
We've also been successful in in taking Unboxed to some of our customers. So Netcore has a large footprint across India, Southeast Asia, ah GCC, Africa, Latin America. So we've also been successful in cross selling from our purposes.
01:36:03
Speaker
But for us, that was the third objective that we can actually also get more business. but the first two actually have worked out quite well for some very good brands in the US. Perhaps where we have not been as successful is in doing more of the cross-sell of the netcore products into unboxed customers.
01:36:22
Speaker
um because we realized later that the buying center is slightly different. They're both under typically the marketer or the product person, but Unbox sells more to merchandisers, Netcore sells more to the CRM teams.
01:36:34
Speaker
But eventually now what we are seeing is more and more ah brands now in the US want fewer vendors to deal with. So that is helping us a lot Otherwise, it's finally it's a data play. You don't want your data siloed.
01:36:48
Speaker
The more the data is together, that is where the real magic of AI starts to work.
Bootstrapping vs. VC Funding: Strategic Insights
01:36:54
Speaker
It's friction dealing with many different providers. So in a way, when Netcore and Unboxed come together, we can replace four different entities with just us. And that is helping us a lot now, in especially in RFPs now for the larger enterprises in the US.
01:37:10
Speaker
Okay, okay. ah How are you doing the, like the cultural integration, you know, unboxed is, I'm assuming a US incorporated business versus net core, Indian incorporated business, and that too, a bootstrap business, no influence of VCs. ah So how does that cultural integration work? How do you make the merger successful?
01:37:40
Speaker
Actually, it was very easy because Unbox almost entire team was in Bangalore. So it was a but a good example of an Indian company. One of the co-founders was in the US, Pawan.
01:37:53
Speaker
We a small sales team in the US and we were organized very much similar. So we got a large footprint ah in Bangalore. um So that worked out quite well actually. And so integration was much easier. So we actually bought an India incorporated company.
01:38:08
Speaker
with a significant US presence. So it was quite smooth. And this was a cash acquisition or they also have equity in Netcore? It largely cash, primarily all cash. So ah how, that like Netcore had enough, like 100 million worth of surpluses in the bank, uh, Yeah, we yeah we are we had saved up a lot of money.
01:38:31
Speaker
Wow, incredible. So um just for a small plug, both the India World and Netcora, what I call ProfiCons, this is the book I wrote three years ago. um So ProfiCon is a company which is which is a startup, which is private, which is bootstrapped, which is profitable and scaled.
01:38:53
Speaker
So the other way to frame it as as a friend of mine put it recently is that ah many businesses are funded by venture capitalists, VCs or PEs. Netcore is funded by its customers.
01:39:03
Speaker
Yes, true, true, true. But ah I mean, you spent 27 years. So somewhere there is a trade-off. Like CleverTap is also about 100 million ARR. You're, I believe, also about 100 million revenue. Yeah.
01:39:19
Speaker
they did it much faster because of that VC money. So there is a trade-off. right like As an entrepreneur, you may not have the patience to spend a decade and a half building something. ah that that is i mean That's also a consideration. Yeah. So there are two trade-offs. You've described one of the trade-offs, which is, of course, speed in terms of money gets you speed.
01:39:40
Speaker
ah You compress time. The second trade-off also is in ownership. Yeah. Yeah. but In most, so when I used to talk about the Proficon, I would say that for a unicorn, you need to get to a billion dollar valuation for the founders to make maybe a hundred million dollars.
01:39:59
Speaker
In a Proficon, assuming you own much of the company or the found the founding team owns much of the company, you need to just get to one hundred million valuation. Yeah, true. So, there are trade-offs, absolutely correct.
01:40:12
Speaker
But when I look back, Akshay, what I like is the fact that um and when i go to, when I see many VC invested companies, especially in times like these, where SaaS is under a lot of pressure, valuations are falling, at least in the SaaS space, um we have freedom.
01:40:32
Speaker
We have decision making freedom. there is um I mean I said this when I mentioned this on my blog. ah and During times of crises, I was writing about Covid.
01:40:43
Speaker
Unicorns fire, proficons hire. so Right. well There's a lot of pressure to a, you know, you've got to cut cost 20% or just fire 20%. And then effectively the the founders are working for the investors.
01:40:59
Speaker
If you've done three or four rounds of capital raising, the founding team has not more than 20, 25% left. The of the company is in the hands of investors. So it's a trade-off. Absolutely agree. depends on what the long-term mission is.
01:41:16
Speaker
I've or sold a company once. So I've been on the other side of it. um Here, my hope is that Netcore can become, in the words of Jim Collins, an enduring great company, a built to last company. So that's what I want.
01:41:29
Speaker
But it's been a slower journey. i fully agree with you. Are you planning more acquisitions? We have done a few smaller ones ah prior to Unboxed also. ah See, the challenge what I've seen now, we've seen in acquisitions, is that the next acquisition we'll have to do, because we don't have a valuation set on us, has to be all cash, number one.
01:41:51
Speaker
Unless we raise capital or whatever, number one. So that limits. And Unboxed was reasonably large-sized deal in that and that context. The second is that... up With AI now coming into play, into the mix, one has to be very clear of what is the value that you are going to get from the acquisition.
01:42:13
Speaker
Because there are verticals being disrupted dramatically. oh ah And from a coding perspective, today coding can be done fairly quickly, especially for new products.
01:42:28
Speaker
up now in in in weeks rather than say ah months to the extent of a year or so. um At the same time what I also think is that is our space so crowded that I have to now look at adjacencies.
01:42:45
Speaker
Now my belief is that MarTech actually has looked at the world wrong. See we have looked at selling entirely based on inputs. number of messages, monthly active or monthly transacting customers, entirely based on inputs.
01:43:02
Speaker
And that in itself has constrained the size of the MarTech industry. I think the shift that MarTech needs to make is to effectively go to outcome based pricing.
01:43:18
Speaker
So we are actually selling
Outcome-Based Pricing in MarTech
01:43:20
Speaker
Ferraris, but the operator on the other side is like a taxi driver. complex systems. But the operator there is a person like you said earlier, maybe a person with 12-18 months experience in industry who is very enamored by the ad tech world because that's where all the money is going. So, MarTech is basically a place to spend 18 months, 24 months and then get out from there.
01:43:45
Speaker
Now, If we can shift the focus from ah just input-based to output-based, I call it alpha. It's effectively exactly the way hedge funds work.
01:43:57
Speaker
There's the beta which is the baseline. So if Sensex gives a 10% return, the base is not 0 but 10%. Alpha is what the hedge fund has to generate over the 10% and then take a percentage, a carry.
01:44:14
Speaker
that. I think that is the future of MarTech. And if we can do that, the TAM, the addressable market, the total addressable market actually is bigger by a factor of 10 or more because now we can actually deliver value based on percentage of revenue that we are able to generate.
01:44:37
Speaker
mean This is the most exciting part. I think all the all the elements which are required to do this are there. It requires us to shift our thinking from input based to outcome based pricing.
01:44:51
Speaker
And now with AI, I think it is absolutely the agentic We have built a lot of the agents now, the orchestrator and the specific individual agents. I think we can actually make this thing happen. This is my big focus going forward.
01:45:04
Speaker
Because if we do this, we go from the red ocean that is today every MarTech player, every CPaaS player, okay very competitive markets.
01:45:15
Speaker
You go from there to a blue ocean where you are effectively telling brands there is no competition. am on your side of the table. have got skin in the game. to deliver outcomes.
01:45:27
Speaker
So the one phrase I like to use is progency. It's product plus agency combined together. That is what I think the future is. I don't we need more acquisitions. I think we just need to make this thing happen. I would look at acquisitions more for adding specific product capability which compresses us time or maybe geo, expansion specific markets where it's harder to us for us to build organically.
01:45:53
Speaker
ah Is there organizational alignment on this kind of pricing? Because there is a certain inertia. Your sales team would get their incentives based on the average contract value, which they know from day one. um It is easy for them to sell that because that's how they have been selling so far. ah There is a lot more risk in selling outcome-based pricing deals. ah You don't know whether you'll actually make money on it or not. Even your CEO might have a certain...
01:46:25
Speaker
like resistance to this. So is there an organizational resistance to this? And I suspect this outcome based pricing is more likely to come in through a disruptor, someone new entering the space rather than an incumbent.
01:46:39
Speaker
Very, very good points. Okay. So how I think we have to look at, so we have to disrupt ourselves. it's very clear. That's number one. I mean, the otherwise someone else is going to do it for us. Better we do it. Number one.
01:46:52
Speaker
Second is, I think it will come in sort of there are two tracks. So I call it alpha one and alpha two. In existing customers, can we go in and link some part of our um ah revenue to outcomes? So maybe it's 70% fixed.
01:47:08
Speaker
And then there's an upside linked with the outcomes that we are able to deliver. So that's track number one. The other way to do this is also that in newer customers who are not existing customers, when we are acquiring, we can go in and can offer alpha as the pricing.
01:47:27
Speaker
Now, to make this happen, there are two teams which need to get aligned. One is the sales team and the second is the customer success team because eventually it's the customer success team, of course, with the help from the product team, which has to deliver.
01:47:42
Speaker
So there's a very interesting idea from Palantir, which I want to just borrow, which I've been telling my team we have to now do. That forward deployed engineer. I said customer success teams have to become MarTech growth engineers.
01:47:56
Speaker
They actually understand the business very well. But today they are sitting and analyzing campaigns and you know giving recommendations which are many times ignored by the end customer.
01:48:07
Speaker
So there's one more framework which I want to just bring in and this will help oh and yeah give an idea on how I think we can make the inroads with this pricing. So I like to look at that a brand, their customers are what I call best, rest and next.
01:48:26
Speaker
There are 20% best customers. who generate today maybe 60-70% of revenue. There are the next customers who are the ones they are acquiring, the new customers.
01:48:38
Speaker
And then there are the ones in between. The rest customers are drifting or dormant. And they are constantly in flux. Today's best customer could be tomorrow's rest customer.
01:48:52
Speaker
A good place to start for alpha pricing is actually in the middle. with the rest customers. These are customers who are drifting, who if you don't do anything will end up as a cost center in the next bucket where they after say 2 or 3 months the brand is going to end up spending on ad tech to re reacquire the same customer again.
01:49:15
Speaker
So today if I can go to a brand and say you know give us a percentage of these customers, a portion of these customers. Let us work our magic. We know the industry. We know you are maybe doing 20% of the journeys which need to get done.
01:49:30
Speaker
You are doing segmentation through intuition, through some manual knowledge or whatever manual process you have. We have got the full power of agents. We have the power of cross of deep industry knowledge.
01:49:45
Speaker
Now, if I can go with such a proposition, and say that don't pay me anything but pay me on outcomes. And these are people who are already leaving you or have gone.
01:49:57
Speaker
They will never give us our best customers upfront. But this middle category I think is a great opportunity. I mean I call it this middle that MarTech has forgotten.
01:50:09
Speaker
In fact i In MarTech, I also use this phrase, sort of that it's anti-MarTech. MarTech has become its own biggest enemy because MarTech's job was actually retention.
01:50:22
Speaker
It is because MarTech has failed that the AdTech business has grown so big. AdTech delivered the customer. MarTech's job should have been to build a lifelong relationship with that customer.
01:50:36
Speaker
But that has did not happen. When you're forcing the brand to go back into the world of AdTech, So if we can now through the mix of, I mean these two models, the agents for automating a lot of the functions and the alpha pricing, I think it can be completely transformative in the era, in in the coming era for MarTech.
01:51:01
Speaker
i mean you know like netflix disrupted blockbuster uh it was not blockbuster which should have i mean they they should have done it but they didn't do it uh so so there is that little bit of uh question mark here but i see the beauty of your approach the elegance there is that uh you're not in any way sacrificing existing revenue the existing revenue is untouched you're just supplementing existing existing revenue we're saying okay these I am risking a small part of the fixed existing revenue.
01:51:34
Speaker
The good news is that there is inefficiency. We know that. Inefficiency in the fact that because MarTech is failing, 70% of our marketing budget is spent reacquiring the same customer again and again. This is fact.
01:51:49
Speaker
So for me, I am not asking for an additional outlay. In fact, I am coming in and saying, let me help make this more efficient. And I also know that if I don't do it, someone else is going to do it.
01:51:59
Speaker
My advantage today is that I have deep customer relationships in thousands of customers already. ah new For a startup, they have to go in and build these relationships of trust and access. Right, right, right. Yeah, there is a data access mode that you have. True, true, true. Okay, I see your point. Yeah. ah Help me understand... ah How Netcore acquires customers? you know how Are there any lessons you'd like to share on B2B sales, acquiring these large enterprise customers? How does that happen?
01:52:34
Speaker
Okay, so... We do it pretty much every how everyone else does it. There is no, but I want to change that also. So I'm like Netcode's internal disruptor by the way. Okay. That's a good role to have. I'm not devoting to me. I run sort of small experiments internally. It's the best thing I like.
01:52:51
Speaker
Small or mini startups. Most of them fail, but gives me ability to experiment. So the Skander acquisition, I think there are sort of, would say broadly, three methods that we are using to acquire customers.
01:53:04
Speaker
One is of course ah marketing at events and LinkedIn and all of those things which basically bring in some traffic, not very different from the way the world of ad tech also works today.
01:53:15
Speaker
um The second is up the inbound which happens organically. and So through a mix of write-ups, webinars, um my I write every day on my blog on new ideas and marketing.
01:53:32
Speaker
um Some of that also comes in through requests on LinkedIn for me. And third is, um ah of course, the referrals which happen from existing customers. now What is default, which have not mentioned with the obvious one, is of course a large sales team.
01:53:48
Speaker
that is ah personal one-to-one selling. I don't think that has gone away because these are all mid to large sized companies. We can't do the pure online PLG product-led growth kind of ideas.
01:54:01
Speaker
But what I want to change um is um and I call it the base and the chase. so I would say, i say we have say a company and it applies to every company. The base is the customers you have.
01:54:14
Speaker
So there the question is how can you retain them? How do you grow the and NRR, the net revenue retention? If last year they paid X, can you get them to pay more than X this year? So that's our growth. That's one track of growth which happens.
01:54:28
Speaker
But then there is also a large segment of customers you don't have. That's what I call the chase. So you're chasing these customers. Now, one of the things which we've been looking at and I've been exploring personally is can we create simple landing products where today the typical sale time is about 90 days to 120 days many times, 3 to 4 months.
01:54:52
Speaker
But can I get a foot in the door in 10 days? Can I get access to some billing relationship in 30 days? Can I become the second ESP or the second sdk in 90 days.
01:55:07
Speaker
So without selling my core product, can I use other methods to effectively get a foot in the door? Because what I have seen is, once you have ah ay a good sales person, actually builds a relationship because in our cases, many of the contracts are annual contracts.
01:55:25
Speaker
So you are waiting average six months before you get an opportunity to break into an account, to switch and also frictions in switching. But with every product, there are pain points which are there. With our product, with our competitors' products, everyone is always, I keep saying, you know the first year is the honeymoon period, everyone's happy at the customer end.
01:55:45
Speaker
Second year, it doesn't matter which product they buy, they're always wanting to see what all else is there in the market.
01:55:52
Speaker
So, that is where if we can get a foot in the door, you will now start listening to the customer on what are the pain points. See, we have in a way a thali of solutions.
01:56:05
Speaker
like a Swiss Army knife of of answers. We know. What I don't know is which are the specific pain points. Every customer has slight different pain points. If I build a relationship of trust and get to what the pain point is, it increases my chances of switching when the time of renewal comes So that is where i think I think the best example of the landing was done by HubSpot many, many years ago.
01:56:32
Speaker
They had this website. It's still, I think, there called Website Grader. So you could actually come in there, just type your website, even you can go there today and do it. Website URL and an email ID.
01:56:44
Speaker
And it will then send you what is wrong with your website, what iss right and wrong with your website. Everyone will do it. Like the loading time or SEO or stuff like that. And for HTML challenges, etc.
01:56:57
Speaker
but definitely This, I think, has been the single... most powerful inbound lead generation that's been there ever in the history of B2B selling. to be more Can we create something like this out Was Salesforce acquisition of Slack for a similar ah goal?
01:57:17
Speaker
no i okay I don't know much about the the the backdrop to the acquisition. I would say for Salesforce and they have done many large acquisitions. So Salesforce has been acquisited through its history.
01:57:32
Speaker
I think for them it is more of the fact that you can sell more into the same buying center. Increasing the relationships average contract values. The average contract value goes up.
01:57:42
Speaker
ah You can get some more efficiencies out there. but I don't think they can use the data that's flowing. So it was definitely not for data that is out there because all those are confidential conversations out there. i'm also I think for Salesforce at some point of time, when the core business growth slows, market is expecting a certain growth at the EBITDA level.
01:58:07
Speaker
okay for for sustaining your stock price high at the multiples which it were which it has historically been. um So you need to have the constant acquisition play um for for sustaining your price also.
01:58:20
Speaker
Why haven't you gone public so far? Profitable, 100 million revenue? Yeah, so I wanted to go public maybe three three or four years ago. um And i got all these but I spoke to all these bankers.
01:58:34
Speaker
I got great inputs on, of course, what we would be worth when you would go public. We have 25% ESOP in the company. Another very important reason to go public soon for liquid liquidity for employees.
01:58:46
Speaker
Though we have an internal buyback program, but I can't do the same price that the market would value us. One of the bankers I met, He said, Raresh, look, getting you a listing is very easy.
01:58:58
Speaker
How confident are you of your earnings or your numbers for the next two years? It will take nine months for you to do a listing. That's the process.
01:59:09
Speaker
and it will And at least for the next four to six quarters, you have to be very confident. Otherwise, the stock price will not sustain because people are valuing you on forward multiples. Right. Some future expectations. future expectations, right.
01:59:23
Speaker
And what I had started to see a bit of a slowdown in marketing spends at that time. and Why was that happening? See, partly VC funding has started coming down. During the COVID era, people overspent on marketing in the whole space for customer acquisition, especially in India, um which is one of our largest markets.
01:59:43
Speaker
So we saw some rationalization starting to happen. And also competitive activity keeps increasing, of course. And brands unfortunately try to optimize smart tech expenditures rather than i optimize tech expenditures. That's the other tragedy that I see in our space.
02:00:00
Speaker
Anyway, so that I could not say yes to that question. How confident was I of forward looking earnings sustaining? So then I said, let me not get into that because until I am very confident,
02:00:15
Speaker
ah It's a very difficult um oh um bet to make. You don't want to have a listed company and then have the quarterly pressures also and the falling stock price.
Innovative Revenue Streams and Expansion Strategies
02:00:28
Speaker
um That's a very toxic combination. In my life, you know my father had told me this long time ago, even before I started, he's saying, be very careful when you're taking other people's money.
02:00:41
Speaker
If possible, avoid it. At that time, he meant more in the context of a loan rather than equity and um you know in a listing.
02:00:51
Speaker
um But I'm always that much more careful when you're when you when when when one has to take outside capital. Is it on the roadmap? Yeah, IPO is definitely. I think if we can get...
02:01:05
Speaker
now So now the challenge, of course, is that there's the AI element also in there. That we have to, SAS valuations have fallen in the last year. The SASpocalypse, as they're terming it. Absolutely.
02:01:17
Speaker
So what I have to be very confident about is that we have a very powerful AI story. um We have a retention story. And we have what I call the sort of four M's along with the blue ocean part. There's some parts of our business, are at least in the blue ocean, where we have a moat.
02:01:34
Speaker
We have a monopoly in that particular segment. We have a way to multiply. There are multiples multiple paths for us to make more money. And of course, the fourth M is money.
02:01:46
Speaker
and There is a secure or there reasonably well protected cash flow coming in the future. well That's what markets are valuing more companies on. So my belief is that this what I spoke to you about on on this alpha outcome based pricing is one.
02:02:06
Speaker
ah There are a couple of other ideas like this that I am working on.
Rajesh Jain's Political Involvement and Impact
02:02:09
Speaker
um i did an essay on my blog. By the way, i write every day on RajeshChain.com, hundreds of essays on marketing. So one of the essays I did on B2B SaaS saying that SaaS or B2B software companies need to look at two new revenue streams.
02:02:25
Speaker
We spoke about outcome based pricing. But the second one, second track is actually also If you are selling to B2C companies, can you create ads as a revenue stream? Can you monetize attention?
02:02:38
Speaker
So I'll give you a simple example. We send out zillions of emails. We charge people on per email. What if the emails were free? I call it zero CPM.
02:02:50
Speaker
And what if we could run third party ads? So make email into a attention and monetization surface rather than just a sell and notify surface. ah Let me quickly wrap up with one chapter of your life we haven't spoken about.
02:03:05
Speaker
Are you the man responsible for the election of Prime Minister Modi?
02:03:11
Speaker
I think I was one of many people who worked. okay So let I'll tell you my role and I've written about this, I've spoken about this earlier, um but not as much. Because in the political space, it's better to be quiet about what you've done doesn and then talk a lot about it.
02:03:27
Speaker
And I'm not in the business of politics. So, um
02:03:34
Speaker
between 2011 and 2014, I had set up a separate team to work from the outside for Narendra Modi. During that time, he was the Chief Minister of Gujarat.
02:03:46
Speaker
but What was the trigger? How did you like discover this space or this problem? To go back a little bit in time, 2008-9, there was a slowdown. We were also very small.
02:03:58
Speaker
um We were doing our SMS business. um And and ah the BJP was looking for an SMS vendor at that time. That's how I got connected.
02:04:12
Speaker
um with At that time, it was Piyush Goyal. um he had come to vet us and I just happened to talk to him saying that you know there are a lot of people like me who are unhappy with the direction of the country and who would like to help out in some way we are middle class people you don't know attend your rallies and all and that's how he said you know other people have spoken to me also along similar lines so then a few of us professionals got together and created friends of BJP for the 2009 elections So we organized events for ah what we called middle class India effectively.
02:04:47
Speaker
i mean, who would not attend rallies at say large grounds and all that bust and whatever. um But even first time you know, you could actually ask questions directly to the politicians across the table um in groups.
02:05:01
Speaker
Of course, BJP lost the elections quite badly in 2009. um But that idea that people like us can perhaps be engaged in politics, i have no background in politics at all, sort of got triggered in my head.
02:05:18
Speaker
In 2010, I wrote a blog post ah publicly in May, ah may June 2010, saying that the BJP can win a majority on its own in the 2014 elections.
02:05:36
Speaker
This was what I called Project 275 for 2014. And I only analyzed data. I analyzed the outcome of elections. I realized that the BJP had won 299 seats at least once out of the 543.
02:05:51
Speaker
And that if they needed to win a majority in 2014, the election had to be not a summation of state elections as had started to happen in India with the coalition governments.
02:06:02
Speaker
which were getting formed, but it had to be a wave election. It had to be a very different type of election, a national a national election, not a summation of state elections. And if they got a 90% hit rate, and they'd be home.
02:06:17
Speaker
So I wrote this publicly on my previous blog at RajeshChain.com, at Emergik.org. And ah around that time, someone had connected me with Narendra Modi when he was CM of Gujarat. So i I met him a few times.
02:06:34
Speaker
Look, you know I'd love to see a different future happen. I mean, Gujarat at that time was seen as the model of development also. I mean, when you could actually see the difference in road quality as you drove from Gujarat to Rajasthan, used to go to Rajasthan very often.
02:06:51
Speaker
You didn't need a border sign to tell you that the state has changed.
02:06:58
Speaker
Now, so, but what I told him also at that time, here I want to work from the outside. I don't want to become a vendor. I don't want to work from the inside where I knew that a lot of the politicians I'd seen it earlier did not value people from the inside. And said, I don't want to be alone.
02:07:17
Speaker
Otherwise I am just like two hands, two legs, one brain, that's it. i said I will and i i'll do what I do best. I will create a startup to work for you but from the outside I will fund it myself. I will not take your money.
02:07:29
Speaker
So that's where I created a startup. ah called Neeti Digital. We did four things. We did media. We had a portal ah for pro-BJP news, pro-Modi news because um that was not the case what was happening in India at that time.
02:07:46
Speaker
We have to go back to that period It was analytics, so data aggregation. I built a site, indiavotes.com, which is still active. I think it's still the best elections data website in India. it's The design is very old because I have not updated it, but it's still one place where you can get election results oh since independence um in a nice manner, queryable manner.
02:08:08
Speaker
are Then we did analytics and a volunteer. So, India Votes is a site for analysts, not for Amjanta. No, no, it's for analysts. People who want to figure out what happened in the past. So the traffic peaks at election time.
02:08:22
Speaker
The elections data, I think, should have done this job, but they still put out PDFs from election results. You will take the PDFs and then digitize those and all of those things. Analytics was about ah using ideas from the Obama campaign.
02:08:36
Speaker
on how to build a better ground campaign, how to figure out who is supporting you, how to get out the vote. So lots of interesting ideas. I brought a tech and sort of media perspective in there, but I ran it myself.
Post-Election Focus on Economic Education and Advocacy
02:08:49
Speaker
And I was very clear that once the 2014 election gets over, I'm back to netcode. For me, that was at 2011 to 2014 period. stay Staying with what you did there, ah sorry, can you repeat the name of the initiative? You said Neeti?
02:09:04
Speaker
Neeti Digital. Neeti Digital. NITI was New Initiatives to Transform India. This a precursor to the NITI Aayog word. NITI was a very nice word. I'm acronymized.
02:09:19
Speaker
So this personalization that you were attempting, did how did it actually benefit the BJP? Like, were you able to give them data that your people should call these voters? are like like How did it actually impact? We ran multiple things but one of the initiatives we ran was that look if you supported the BJP,
02:09:40
Speaker
um ah send an SMS with your voter ID. a specific number and then weer we had mapped the voter id to the polling booth. So we had done some ah data analytics work at that time.
02:09:55
Speaker
So this way on election day and this is exactly how the get out the vote what they call GOTV in the US, get out the vote election day works. How do you identify your supporters?
02:10:06
Speaker
How do you make sure on election day they vote? Because it's eventually not the support base that you have but how many of the supports do you get out of the polling booth?
02:10:16
Speaker
So there was a very good book called Victory Lab by Sasha Isenberg, which had come out, which actually had it was a political science book. And I'd read that book, amazing ideas on on on electoral politics.
02:10:29
Speaker
And I'd seen some of that in 2014. Sorry, yeah, 2014. And 2009, when I was in the first... and um play two thousand and nine when i was but Okay, with first. You know, very little, actually it was all sort of, um they don't be the the parties would not know who their supporters were.
02:10:48
Speaker
ah um And therefore it was all just whoever voted sort of voted. And with the Obama campaign, i realized that it was very, very scientific. They knew the supporters, they would make sure that they voted on election day.
02:11:02
Speaker
um And we tried to do this in many of the polling booths because BJP has a very good ground presence. But to bring out to Wooten was a bit of a challenge. So that's the sort of element that we brought in.
02:11:15
Speaker
And ah post-election, you were continuing that journey? Post-election, I was very clear that my job is done. So I had no interest on that side. But then I also, there was one question, you know, a few of us used to talk about, know, why is India poor?
02:11:31
Speaker
And I had no background in economics and ah a friend who actually educated me on some of these ideas, Atanu Dei, he educated me on many of these ideas on why is India poor.
02:11:45
Speaker
A Paatshah from CCS, Centre for Civil Society also helped. I attended a number of conferences in the US. I taught myself some of these basics in economics. I never learned any of this in my life.
02:11:57
Speaker
um And then the key idea basically boils down to what's called, we use it very lightly, the word freedom. Individual freedom, economic freedom, political freedom.
02:12:08
Speaker
um And then when we analyzed a little bit more, the root cause is effectively the constitution of India, which is effectively a hand-me-down from the British government, 1935 Government of India Act, meant to enslave, not to free a people.
02:12:23
Speaker
So then I tried to do a few things. I tried to create a i movement to try and change India's constitution. It didn't go anywhere. That was very naive. I tried to free the Indian cities you know from the clutches of the chief ministers um because urban pop people are migrating to cities and then cities are sort of, you know, look at the infran, look at the state of many of our cities.
02:12:48
Speaker
Because the cities, The money is sucked out but not enough comes back for building the urban infrared, the level at which it should be done. um Then I tried to create something called Naidisha, a new direction for India. um One of the ideas in there was Dhan Vapasi, that there is a lot of wealth in India which actually belongs to the people of India.
02:13:08
Speaker
which if you can hand back to the people and let them decide what they want to do rather than these stupid zillions of um ah welfare programs, lot of where corruption also happens.
02:13:19
Speaker
um arm I mean, the idea was that you look at Luddians Delhi, you look at or defense land in cities. even railways land. Railways land, PSUs. mean, the government, yeah finally, it's also what Modi had said in 2014, the government has no business of being in business.
02:13:36
Speaker
um So there were these ideas and I thought I could educate people on some of the core ideas of classical liberalism, which is what helped America become what it is, the American constitution, is something you can carry your pocket.
02:13:52
Speaker
Of course, I was too naive, like I said. I couldn't change any minds just by making a few videos and writing some things. I couldn't do anything. So then come 2019, I said, look, this is not going to work.
02:14:04
Speaker
So I shut that down and then back to Netcore full time. but But do you think this is a chapter you will open again? No. No? Okay. So, see, it was very clear to me. I mean, I've seen politics at reasonably close range than most...
02:14:18
Speaker
people of our types, it is not for us. um it's ah In India especially, it is a very different ballgame when it comes to the political process that is there, even the electoral process that's there.
02:14:33
Speaker
um And ah it's very hard for people like us actually to make any sort of difference. So I said, I mean, I could, I mean, I did a lot of essays at that time on what we need to do. We had a Naidisha manifesto and I read it even after all these years. I think it's still a good one.
02:14:53
Speaker
Dhan Vapasi is still a very good idea. um But I don't think they're going to get any, ah they're going to make any progress. I said the best that I can do is as an entrepreneur. If I can do well in my life,
02:15:06
Speaker
And then if I can give back in some ways to philanthropy, ah that's a great chapter. Like in IIT Bombay, two of us have set up a fund for converting, helping professors take faculty research to IPO. So we call it IP to IPO or lab to listing.
02:15:26
Speaker
it's great you So things like this, where I think I can use my out of the box thinking, my entrepreneurial skill sets, in fields which are not linked with government, but there is plenty of things which you can do in life.
02:15:40
Speaker
One looks for, I think, what David Brooks had once called in the title of his book, The Second Mountain. So when you are in the 50s, you look at what's coming up. ah Jim Collins' new book that's coming up, What to Make of a Life, talks of very similar things.
02:15:55
Speaker
um and though Ask this question, late in life, and how do you sort of keep the fire going? Of course, for right now, it is all net core. ah But at some point of time, what are things which I can do beyond net core is absolutely what I want to look at. But politics is not one of them. I think entrepreneurial linked for prosperity is how I would put it.
02:16:19
Speaker
Amazing. Amazing. Thank you so much for your time, Rajesh. Thank you very much, Akshay, for inviting me. Wonderful talk. Thank