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Breaking the paywall of high-skilled jobs | Prateek Shukla @ Masai School
335 Plays2 years ago
Inspired by the teachings of the Masai tribe in Kenya, Prateek started Masai School to help Indian students bridge the skill gap. He’s been through a rollercoaster ride as a founder and he shares his journey of building Masai School, a journey that began soon after he graduated from IIT Kanpur.
Additional links:-
2.This IIT Kanpur alumnus built a coding school in Bangalore that enrols students for free
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Transcript
Introduction and Innovative Education Models
00:00:00
Speaker
Hi, everyone. This is Pratik. I am founder and CEO of Masai School.
00:00:20
Speaker
There are a couple of ways in which the problem of affordable higher education can be solved. Traditionally, this has been done by offering loans to students or by offering scholarships or through the government getting into the space of education and running colleges. But probably the most innovative approach towards this is for a college to charge a student only after he is employed.
00:00:42
Speaker
After all, getting a job is the primary reason for someone to pursue higher education. While this sounds great for a student, it's not always that great for a college, which is why many few higher education institutions offer this.
Masai School's Unique Financial Model
00:00:55
Speaker
In this episode, you will get to learn the secret source of building such an institution as your host Akshay that talks with Pratik Shukla, the founder of Masai School. Masai School is India's leading pay-after-placement higher education institution
00:01:10
Speaker
helping thousands of students to jumpstart their careers. Tatiq's been through a roller coaster ride as a founder and he shares the journey with staff soon after he graduated from IIT Kanpur and founded Grabhouse, a pioneering startup in the real estate space. Stay tuned for the conversation and subscribe to the founder thesis podcast and any audio streaming app to hear fascinating conversations with India's most disruptive founders.
00:01:43
Speaker
in our country, 95% of our engineers don't know how to write a single line of code. And at the same point of time, companies are struggling to basically find out real good engineers who can be job ready and who can contribute from day one. So Masai is basically solving that or narrowing that skill gap which exists in our country because of poor education system.
00:02:02
Speaker
So we have raised roughly around 20 million dollars so far across four rounds of capital. And currently we are on an Android that this financial year we will close it at close 150 crores revenue. So that's where we are on. But there is one very interesting thing which I wanted to basically speak about what Maasai is actually solving is that
00:02:29
Speaker
Masai, because as I said, we are an outcome based education institute, that means that we don't charge any upfront fees from students. Students enter into Masai school without paying any single penny. And once they graduate and start earning about 5 lakhs per annum, then only they pay us fees. If they don't get a 5LPA job, they don't pay us anything. So it's improved since it's a completely outcome based education, where it's a win-win for everyone once the student graduates.
Journey from IIT Kanpur to Entrepreneurship
00:02:56
Speaker
So what happened was I actually, when I entered into IIT Kanpur, I studied in a school where our English teacher used to speak or used to teach us in Hindi. So that level of school was there where I have studied. So when I entered into IIT Kanpur, I saw
00:03:17
Speaker
table tennis for the first time in my life. And there are many new things that I've seen for the first time. And it was like a very different world altogether. So that's where I have decided that I have studied all my life. And that's why I don't know anything. Now this is the time to basically get more and more exposure. So I participated in anything and everything that happens in college and I used like I won several elections.
00:03:43
Speaker
I was part of all the leadership teams, the cultural fest team, the technical fest team, and everything around that. So, because of that, I have built my resume, which was considered in my batch as one of the best resumes. From a position of responsibility perspective, that you are managing a team of 500, 700 people.
00:04:06
Speaker
So what happened was I became more confident. Okay. And I thought that now since I have the best CV, I am going to basically select the companies where I want to go, rather than company selecting me.
00:04:23
Speaker
I short-listened McKinsey, BCG and DB. So these are the three companies that I'm going to set. And if it is going to happen, if I'm going to get a job, then that's like it. I don't need to basically set any other company. Surprisingly, McKinsey and BCG
00:04:45
Speaker
didn't came that year. They backed out on the last minute. So only a TV was there. And I was like in the first round itself.
00:04:58
Speaker
And the unfortunate thing about the IIT Kanpur placement is that around 70, 80% of the batch gets placed in the first seven days itself. Okay. So you have to basically apply to the company before. I have not applied to any of the company. And then for seven days, all the batch plates are placed. And I was the only one who was sitting like this at home in the room in college.
Startup Challenges and Lessons Learned
00:05:20
Speaker
I mean, that was job. Um,
00:05:23
Speaker
Then I thought that, and I was like very, very, like that was the most disturbing phase of my life where everyone was continuously calling me that job. But then I took a break. I, I like, I somehow went to Mcleod all by myself for the very first time in my life. I was traveling by myself. I went there for 15 days.
00:05:49
Speaker
I'm not going to get any jobs. Went there. And then came back with a plan. With a very, very powerful plan. So, either that I'm...
00:06:03
Speaker
I have never followed this hard mentality in life. I don't know whether McKinsey is the best company for me. I don't know whether consulting is something which I want to do all my life. I still don't know many unknowns in life.
00:06:19
Speaker
Okay, so what I'll do is what I love from Fourier experience, that is only which I'll shortlist the areas. And then I go to those specific companies and see if I like those companies, then I'll build probably my career in that. So I shortlisted four areas. During those 15 days, I was reading this book called Banker to the Poor by Robert Ullis.
00:06:44
Speaker
So I was fascinated by this microfinance, the boom in economy in Bangladesh, which is happening because of microfinance.
00:06:53
Speaker
So I first shortlisted microfinances where I want to explore. Second is advertising where I want to explore. Third is marketing where I want to explore. And I did my internship in teacher India. So probably NGO is the fourth thing where I want to basically explore. Fifth would be startup. And this is what I want. I'll do in the entire year to two months or three, three months in each of them. And then I'll figure out whether what I want to pursue in life.
00:07:18
Speaker
So well, I called email mom with you in this, sir. Um, that I want to, I, I want an internship. I have a fourth year undergrad in IIT. And, uh, I was not expecting any, uh, reply, but I got a mail back from their team that we usually hire MVS, uh, for internship, but, um, because I quoted some of the things from his book in the field, that's why they said that we want to give you a chance.
00:07:48
Speaker
I was on cloud nine. I was like, I got an internship. I called my mom. I got an internship. Then I said that it is in Bangladesh. Then Bambi was like, bro.
00:08:18
Speaker
If you imagine like someone from a lower middle class, they usually think I hate to be gay. The US is. Someone is going to Bangladesh and that's an unplanned internship. So she refused. There are floods and there is malaria, there is everything over there and you can't go.
00:08:44
Speaker
What is the point of which she refused and she said here I'm not going to speak to you if you'll go over there. But then I was thinking about my second internship. Let's try advertising in times of India. So I was cold emailing them. During that time, one of my batchmate who started entrepreneurship sell in IIT Kanpur. So
00:09:10
Speaker
Prior to us, there were no seniors, those who have initiated startup concept in campus. There are many seniors of mine, those who are well-known founders, like Aabiraj is my senior, Nobrukar Vai is my senior. So all of them are my senior, but they have not started startup from college itself. So in college, there was no concept of startup, and that's why one of my friends started ESL.
00:09:36
Speaker
And his idea was that he started a startup in third year. And his goal was that in fourth year, I'll come for placements and I'll hire my batch mix. And that is what has happened. And before that, I had no idea about venture capitalists and anything. But they had raised capital while they were in while we were in our fourth year. What was the space they were operating?
00:10:03
Speaker
It was a customized merchandise. So mantra at that point of time was also in customized merchandise. So if you want anything like a t-shirt, that is something that you can do. So that is what the idea was. And they had raised like 10 lakh rupees and they asked me to basically become their co-founder.
00:10:25
Speaker
So fourth year, finally, I worked on that startup. By the time I graduated, I was working over there. And then I thought that this is what I want to do all my life. This is what I love doing. I am a workaholic person. I love working. I love doing hard work. And at the same time, I love solving problems in a creative way. And I think probably this is my calling. So that's how I started like fresh out of college. I started Grabhouse.
00:10:54
Speaker
when I graduated. That's how it has happened. You left that co-founder role to start Grabhouse. What was the trigger there? Was it that Grabhouse was an idea which you had to pursue or was it that you were not finding satisfaction in that co-founder role?
Grabhouse: Growth and Operational Strategies
00:11:16
Speaker
Actually, the thing was that customized merchandise has their own issues around copyright. I was telling my co-founder that...
00:11:27
Speaker
This is something which we need to find out a way around because it is not scalable. Okay. As soon as you basically start putting Iron Man over there, someday we are going to be sourced by someone from Marvel. So you can't do that. And this is what...
00:11:47
Speaker
Like, so this guy wanted to basically build it irrespective of anything. But now if you want to scale it up, you need to basically think of something else. So there's no point in actually working on this. When we know that that startup
00:12:13
Speaker
After I wait within one year, it will shut down because of copyright issue.
00:12:19
Speaker
So that is something which you could tell them, there's no other way. Grabbers was something which I wanted to do something in real estate because I knew from whoever has actually my batch mates who have joined these bigger cities. So we had a WhatsApp group. At that point of time, Facebook groups, it was 2012, 2013.
00:12:49
Speaker
The everyone used to basically crib key are Questioning will ride going hardy will ride and all those things so and roommate finding roommates and other things was a challenge So I knew that this is something which is a space that I where I want to operate in so it was also Quite a unique concept and then no break no brokers started after nurse which was
00:13:12
Speaker
Like we'll connect the owner with a potential renters without involving middlemen through the platform itself. So that was the idea. And we raised like around $15 million over there as well from Sequoia, Kalari and all the other folks have participated. Amazing. How did you raise so much money just one year out of college? Take me through a bit of the journey of building gravels.
00:13:37
Speaker
So, one of the first investors, the first believer was India quotient. And they are also one of the first investors in Masai. So, incidentally, in 2013, India quotient was started. And India quotient started with a bootcamp model.
00:13:58
Speaker
Okay, so they wanted to basically bring in all the companies, they were not taking any stakes or anything, they were just providing office space. Like an incubator. Yes. So they had started that. That was the first incubator, which they have started and
00:14:19
Speaker
They did it for like two batches and then they shut it down. But we were selected in the first batch. You had a co-founder? Yeah, I had a co-founder. And there was another friend of mine who was working with me. So we were three folks. These are like your IIT friends.
00:14:42
Speaker
Well, then was my friend. So he was from, I did anybody. He was my school trainer. The one was, I met her, uh, during, uh, teach for India. So three folks, uh, those have started it. And then what happened was, um, and you picked the grab house idea to them. Are you.
00:15:13
Speaker
conflicting, like if you think that there is a conflict, then you can basically, you should not join. It was in Paytm office in Mumbai, which was next to the airport. Beautiful office. Vijay Shekhar provided the space to India question and they started a boot camp over there.
00:15:23
Speaker
join the incubator thinking that we'll formalize an idea as we go along.
00:15:40
Speaker
And we were fascinated because we have not worked in a job before. Correct. We have not seen a corporate office. Okay. And we had an office which has internet, which has coffee and that is available 24 seven. So we literally made that our home. So me and one of my friends who was from IT Delhi, we literally
00:16:04
Speaker
stayed in that place for 49 days without taking a path. We have slept there. We have tried to remove the security guard because we told him that with shared salary, we'll also basically manage the fourth. We have literally, like one incident I'll tell you what happened and that is something which triggered Vijay also.
00:16:30
Speaker
PTM meeting was supposed to happen. Nine o'clock was the time and it was a boardroom. Okay. So the AC was like, it was like 16, 17, 18 degrees Celsius. So we used to basically, we had no blankets or anything. So we used to feel cold. So what we used to do is we used to basically sleep inside, like beneath the boat.
00:16:52
Speaker
the table, the boardroom table, the big table. We used to basically sleep over there. I woke up at seven, but one of like my friend was sleeping there. It was at nine o'clock when everyone was in the room.
00:17:10
Speaker
And 9 to 9.30 is the meeting. So, 9.30 is the beach. Why are you guys making so much noise in the morning?
00:17:48
Speaker
This is why we incubated on Aga Chelladi after second match.
00:17:55
Speaker
So, we were the only company which got funded through that incubation. The reason for that was that Anand is not going to be able to do that. Anand Madhguru said that he is a team.
00:18:12
Speaker
I think it's the best way to do it. I think it's the best way to do it. I think it's the best way to do it. I think it's the best way to do it. I think it's the best way to do it. I think it's the best way to do it.
00:18:32
Speaker
So we were just working from there and we eventually launched a product while we were there in that 49 days like incubator. So we launched it and we got funded. That's how the funding journey started. So yeah, quite an interesting ride in the first.
00:18:52
Speaker
So you would have lost a classified site where property owners can list their properties and people who want to rent can contact the owner or something like that.
00:19:07
Speaker
Yeah, that's how it was. But basically, we were majorly focusing on roommates. So what we were doing is, let's say if you have opened up your house, and if someone is looking for a roommate, that is also a potential owner. And they can also post their property. So there's a compatibility engine which was there. So like, for example, I can live with
00:19:29
Speaker
Let's say I don't mind someone who is living with me, who smokes, who drinks, but there are some people who have issues with that. So basically solid compatibility piece as well. So it's more focused around roommates to start with. And then we started entering into the independent houses as well. Okay.
00:19:47
Speaker
So room H means then the owner of the property itself would not be listing, but someone who already had a room identified would list it. This is not a monetizable audience. I mean, I don't imagine these people would be willing to pay anything to the platform. They were, they were, they were paying. So what we were saying is, so we've been that recommendation engine. We know your requirement. We know what are the properties which are available.
00:20:13
Speaker
So you don't need to basically go through 10 properties and you need to call the people who are living over there. What we'll do is, there is an assistant service where we'll give you three quality leads. Out of the three, you will close one of them. So in order to get those three leads, you are going to pay us 2,500 rupees. And people were paying for that convenience for the piece. And that is the model, business model of no broker now.
00:20:41
Speaker
Um, so that's how it was. Okay. Okay. Okay. Interesting. But there's not a very, uh, big tab, the people who are looking for a shared flat, like a shared. Yes. Yes. That's why we entered into the independent houses, the normal, like when families were looking for basically taking the entire house. So we started with that because we did a growth hack over there. Like there was several growth acts in grab house. So one of the first one was basically.
00:21:10
Speaker
We acquired one Facebook group. And that was the first equation we had. We paid 50,000 rupees and that group was acquired. It has close to 25,000 members and they were constantly posting it over there. So we basically... And they're like a property search or a roommate search group. So we acquired one group and then we formed like 15-16 groups.
00:21:35
Speaker
At that point of time, Facebook APIs were opened as well. So as soon as someone posted on Facebook that I'm looking for a flatmate, you immediately get an inbox message from us that why don't you post it immediately on Grabhouse and get a roommate. So that's how the engine was working. And then
00:21:58
Speaker
when we moved to the independent houses. There's one interesting thing in Bangalore and in Delhi as well, where people used to put tooled boards outside their houses. So what we used to do is we deployed an army of college grads. We created a small app over there that when you see a tooled board, you just need to click a pic and we'll give you 50 rupees, McDonald's, coupon.
00:22:25
Speaker
And that was something which actually made us, or we accumulated on a single day, like there was a thousand listings. So, multiple hacks like this that we did. Amazing. Okay. So, and your, for that, like, did you also burn money for customer acquisition, like marketing?
00:22:50
Speaker
performance. We don't basically spend money on customer acquisition. Because in grab house, it doesn't make sense to basically bringing customers if you can't basically channelize the existing source. So you need to basically create a viral engine on the top of Facebook first, okay, and once you do that, then it makes us it makes a lot of sense to basically
00:23:18
Speaker
The problem with the entire model over there is it's a very slow process, as you rightly mentioned. It's a slow process because for 11 months or for next 22 months, the house is not going to be available. The repeat value of the customer is very low, basically. Very low, yes. Second important problem over there is that
Operational Challenges and Realizations
00:23:45
Speaker
There are four different zones in which we used to categorize the city. So there are hot zones, there are warm zones. A hot zone means that the property is not a place. So even if you'll get the property, by the time you basically start looking out for people, it is already filled. Okay. And that's the same thing with warm zones. Being in a metro station and like those kinds of...
00:24:08
Speaker
Correct. Correct. And that's the same thing with warm zone as well. So, the entire premise of this model and this is something with no broker sold it beautifully and they are like my seniors and I know them personally and they're also investor in massage. So, he had patience. He said that
00:24:34
Speaker
What we will do is, second time we will aim to basically fail it faster than a broker. Okay. And third time you need three cycles to basically convert an owner to be also giving you the lead that the property is available. It is not possible. So it takes three years for one. It's like a real long-term game. Amazing. And they have built it beautifully. Right. Right. Okay.
00:25:04
Speaker
If you didn't spend on performance marketing, then why did you need to raise so much money? Like $10-15 million and that era is a lot of money.
00:25:13
Speaker
Yeah. Yeah. So we had actually pivoted because he had a slow problem. And we were just 24, 25 years old. Okay. We thought that he had a slow time. We are not going to do that. We are going to rush. We are going to build something crazier. And like, we need to be part of this growth story of India. So then we pivoted to a model called fully furnished managed house rental business.
00:25:41
Speaker
Okay. Which is co-living. Co-living, correct. Okay. You're saying business is fundamentally flawed, like a unit economics work out. There's no one who can basically prove that the model is going to work at scale. This model works in small pockets. Okay.
00:26:13
Speaker
Let's say you have taken one house, you have fully furnished it.
00:26:17
Speaker
On one night, you'll get a call, they have taken the washing machine away. What will you do for that? You can take an electric speaker or electric heater that you have. People used to basically rob like crazy. It feels like you are, and it feels very very complex.
00:26:40
Speaker
First part about this model is that you only make money on the last bed. Okay. So let's say if it is a 3BHK and you have given it to six people, you have submitted it to six people, you only make money on the last bed. Okay.
00:27:00
Speaker
Fourth is difficult. Fifth is 50% of those choices, the person will take it 60% with, there is no other option. So that's the last way, which is the most difficult way to fill. And that is the only money. The margins aren't there. That's everything. Desperateing your operational costs. Correct.
00:27:23
Speaker
Okay. And there's very OPEX because you'll need to have like a cleaner, you'll need to have a supervisor who's managing a couple of properties. You need to first have inspection team. The owners will not tell you all the things. Okay. Badmi will realize this is not working. So we have taken a property which had 1BHTAs.
00:27:53
Speaker
Okay. The thing that we realized in the end was after we took the property, we have done everything. Now people, how will people live over there?
00:28:14
Speaker
So, if you have bad property, because of any reason, if you have bad properties, they will go for a toss. So, that's why it is a very difficult, very tricky business. It's not something which can be scaled like crazy, but we did it. And we realized that this is a big mistake. How much did you burn on that? How much did you spend in that business, invest in that business?
00:28:39
Speaker
We had like close to 25, 30 crores over a period of two years was spent on that business. When we were acquired back, like when quicker acquired us at that point, we had like 22, 23 crores in our bank account.
00:28:54
Speaker
So we have invested majorly most of the capital over there because most of the things, most of the capital is capex first. You need to pay the advance to the landlord and you need to spend on the individual work.
00:29:22
Speaker
So, you still had money in the bank when Quicker acquired you. Could you see the writing on the wall? None of these are working out because the initial businesses were like
00:29:35
Speaker
slow growth and probably you didn't see them becoming very big in the short term and then this business was not profitable. So was that why you decided to look for acquisition or what triggered that acquisition?
00:29:52
Speaker
What happened was, we realized, I was 26, I think, when we went quicker. 25 or 26. So, I realized one thing.
00:30:06
Speaker
operational business is something which is not my expertise. I can't run an ops-heavy business. Although Masai is also ops-heavy. Either I need to change myself completely, but I can't run an ops-heavy business. I can't run a business which requires a lot of patience. Again, Masai requires a lot of patience. And third important thing is that I am more of a taken product guy. I want to basically
00:30:36
Speaker
work on product play. And I'll probably be very good at it. And that is something which is the DNA of the organization. So, everyone, like, so I called, like, there were 21 IIT Kanpur people who were working in gravels. There are, like, close to 40 IIT Kanpur folks working in massage. So, all my friends are also like that, okay? So, they are also more
00:30:59
Speaker
Inclined towards taken product. So we realized our business. We were running close to 33 and a half crores monthly. That is not the business that you feel really excited in the morning to basically work on challenges. And I think the nail in the coffin was for me, there was one incident which has happened. So,
00:31:28
Speaker
There was this guy who furnished all the information in a, like they were all fake. Okay. Like one of the people who was one of the tenant in one of the property, he provided all the, all the documents and that were fake. Okay. And then what happened was he was running a prostitution racket over there.
00:31:56
Speaker
And, um, what happened was, um, the neighbors got an idea, obviously, uh, and neighbors, uh, called police. Okay. And police came and the guy obviously, uh, ran away, but, uh, they caught some of the girls, those who were there. And, um, during that time, I realized that boss, this is something which can't be done. Like I was sitting in police station. I was thinking about this, like, this is something that I can't.
00:32:31
Speaker
Like all the information that the person gave us were all fake.
00:32:41
Speaker
Everything was fake. How can you verify those things? And it's a nightmare, like operational nightmare. So probably someone would know how to basically build this risk. And also at that point of time, Akshay, I think we have never seen scale. We have never seen that kind of like, you can make 100 gross revenue.
00:33:04
Speaker
I'm talking about revenue. I'm not talking about GMV. So, but you can do that. And that is something which was, which we wanted to see as well. So that was also one motivation and Quaker wanted to, Quaker had operational expertise. Okay. And they wanted to basically scale it like crazy. Okay. So they wanted, we were on like 3000, 4000 beds. When we got acquired in six months, they had a target that we want to basically reach to 20,000 beds. Okay. 20,000 beds on rent.
00:33:34
Speaker
So they wanted to grow it like crazy. So we thought that this is the right time to basically do it. And we were young. And 2016 was exactly the time which is going on right now. 2016 was the time when everyone went to college aid people.
00:33:56
Speaker
So did you get acquired for more than what you raised? Like you raised about 10, 15, $15 million. So all our investors got stocks, we got some money, and we got stocks as well. It was
00:34:12
Speaker
like probably 1.2 or 1.4 times of what was the, what is the capital we have raised, but we have not made much money. Yeah. So it was not like a happy exit. And we were like, we were also okay with it. Like, because I think
00:34:29
Speaker
If the board is telling you something, you should not be basically, you need to basically listen to that advice. I was very young, way young at that point of time. But yeah, I think there are a lot of lessons that we have learned from that entire graph house equation and everything around that. What were the good lessons, things which you thought that we did this well?
00:34:52
Speaker
We didn't like the growth hacks I tell you. We built the entire company in the initial days on growth hacks. We were the first one. I think like I still remember the day when Amit came to our office. Amit is founder of No Broker. He came to our office and he was speaking to some of the Maasai students. And he said that here Hamdog exists Kartham because Maasai, because Grabo is existing.
00:35:16
Speaker
Yeah, because we actually solved all the problems which no broker took it from us and they actually scaled it beautifully, which we were not able to do it.
00:35:33
Speaker
If we would have stayed with Grabo's till now, we would have made like a unicorn very easily. That was so massive. That was a slow process.
00:35:56
Speaker
So good lesson is that you have problems solving. So that idea that understanding is something which you are able to get. So that's one of the good lesson that you have that quality. So you just need to apply. I think good lesson, which I saw it in quicker is that you don't need to reinvent all the wheels. Okay. So most of the wheels are not meant to be reinvented. Okay.
00:36:25
Speaker
You need to find the right people in the team. Once you bring them on, they'll basically do the work for whatever you want to do.
00:36:42
Speaker
It's like you have capital, you have everything and you have the best brains sitting over there and they want to basically solve problems. At the end, the average age of grab-out steam was around 24.
00:37:08
Speaker
then we realize this is not the right combination. I think
00:37:23
Speaker
Getting the right board is also very, very important. And that is something which I have identified, like I have learned from, it's a good lesson that you need to basically bring the right people to serve the right intent on where you want to visually go. So if you don't have the right people on board to ask to pass out, ask to support, it's going to become your, like it's going to make your life end. How is a board different from investors?
00:37:52
Speaker
Like I'm assuming your board must have been investors only, right? No, no, no. Investors are both, right? Both have like 7% or more equity in the organization. So, both are investors. We have collectively around 50 odd investors, which includes Vijay Shekhar Sharma,
00:38:19
Speaker
So there are 21 entrepreneurs who are invested, then there are the investors as well. So not everyone gets a board seat. So getting the right board is something which is very, very important. Like my point was, isn't the board decision not so much that you can influence it? If someone is investing money in you, then he gets to be in your board. Yeah, correct.
00:38:44
Speaker
But you have the right to basically select the people, correct? You have a right, those who are aligned to the vision that you have. Or either you basically make sure that they are aligned to the vision when they are actually investing it. You tell them everything, anything and everything that is coming to your head that this is where I want to basically take this show to and see if they are aligned or not. Because if they're not aligned, then it is going to become like it is not going to be a fruitful experience for anyone who is going to be part of the board.
00:39:14
Speaker
Even your supporters are not going to enjoy the board meetings to an extent where they want to basically give some advice. You should work hard to avoid a toxic board, basically.
00:39:28
Speaker
It's not toxic. Everyone has a different term. It also depends. It's a seven year or ten year ride. Most of the funds duration is seven years or ten years. Most of them have seven years in India. You need to basically have that sort of a camaraderie.
00:39:46
Speaker
get someone that you can't even spend like two hours or three hours in one go and having them on board. So it's not toxic. It's like basically it's also sort of matchmaking only. You need to find out that comfort and they also need to find out that comfort and they also look for this thing in any order product, whether I have a comfort with that person or not. Okay. So tell me now from Grabhouse to Masai,
Transition to Real Estate and Masai School Inspiration
00:40:17
Speaker
Yeah, so what happened was, I got an interesting call to basically work in real estate. So there's a real estate group, based out of Chennai, SPR group. They were building India's second largest township in the center of the city. And they somehow wanted me to basically run that township. To tell you the worth of that township,
00:40:53
Speaker
So it's a massive township. It's right in the center of the city in Chennai. I went there. It was an amazing ride over there. Like I worked there for two years, building the entire team from scratch. And then there was one interesting concept. The construction also, or like the more of the sales marketing and
00:41:10
Speaker
It was at the base price level, it was roughly around 18,000 crores, 1.5.
00:41:15
Speaker
Yeah, yeah. So the promoters know construction, but they don't know any other thing. So licensing and construction is something which is their responsibility. And everything else is my responsibility, sales, marketing, business strategies and everything over there. But there was an interesting thing that they were
00:41:34
Speaker
building over there, which got me excited, which was the market of India. So market of India is basically, they wanted to organize the wholesale markets. Because if you go into any city in India, most of the city have those unorganized wholesale markets, which are existing there for last 100 years. Okay.
00:41:59
Speaker
The next generation of wholesalers, they don't want to basically continue in the same buildings. So they are looking for a new place. This problem is beautifully solved in China, by the way. China have in evil, if you go, there are Alibaba's mall. So Alibaba mall is exactly a wholesale market. It's not a mall, but it's a wholesale market. Same if you go to UAE, there is a Goldshook market.
00:42:29
Speaker
Yeah. And in Surat, surprisingly, this is sold as well. So diamond and textiles in Surat, that is also exactly like this. So they were thinking that we wanted to basically build a market.
00:42:45
Speaker
which is going to give a feel of a wholesome market, but at the same point of time, it is something which is organized. I've spent some time in China, spent some time in UAE, came back to Surat and then finalized the concept. And that was something which was an amazing thing. And that was something which was
00:43:07
Speaker
By the time I was there, we did a first-place launch and we sold like 80% of the first-place shops then and there itself. So that was an interesting piece that we did. And then at that point of time, once the team was settled, then I realized, again, you are sitting over there because you are sitting over there and you are just optimizing revenue per square foot. So my role over there was the concept property that is raised by the pricing strategy.
00:43:37
Speaker
which was again like again I was at my prime I thought that 29 years you can basically do something more meaningful so that's when I quit they like the promoters of that real estate group are also invested in Masai but
00:43:56
Speaker
Then I quit and then I went to Tanzania. So I met this Masaimara tribe, the best tribe of everything.
00:44:12
Speaker
I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days. I've been there for like seven days.
00:44:37
Speaker
I went there and then I started loving the people interaction and everything which was happening over there and then I extended my stay over there. I stayed with them and then I realized that they are so like obviously they have a very strong cultural beliefs but at the same time they don't believe in formal education at all. They are the
00:45:02
Speaker
They have their own Masai Mara Run schools for each and every skill. People enroll over there right from their childhood and they become expert in that and that's something which was amazing and that's why they considered to be the strongest tribe of Africa. So people are highly skilled in any aspect like the guide who was basically showing us around.
00:45:25
Speaker
So knowledgeable, like the guy knew about each and every tree, each and every animal, what is happening, what is not happening. They literally also bring in that perspective. If you're new to the city or if you're new to the place, how to basically keep you engaged. Whether there are some people who say they are elephants or they cover it.
00:45:51
Speaker
He basically tried to keep you engaged by giving more and more facts and explaining more intricacies of his work which was amazing and that's like the age-old apprenticeship system where as a teenager only you would go and apprentice with whatever field you wanted to
00:46:18
Speaker
make a career in like, if you wanted to be a blacksmith, then you go apprentice with a blacksmith. There's something like that, I'm guessing. Correct, correct, correct. But they have a like a full fledged school for this purpose.
00:46:31
Speaker
You can basically enroll your kids when they're five-year-old, six-year-old, seven-year-old depending on what they want. They can be part of one school, they can be part of two, three schools as well. You can basically learn those skill sets and that's only for Masai Mara. That's quite an exciting thing.
00:46:50
Speaker
I was thinking about what next. So I told you that I did my internship and teach for India in my college days. So I saw the real impact can be created at a grassroots level of right kind of people are involved. And that is something impact to all angle.
00:47:09
Speaker
Chaim, be it for microfinance, be it for any other thing, that was always there that I wanted to do something in that particular space.
Establishing Masai School and Program Details
00:47:16
Speaker
And incidentally, the second round of funding that happened over this statement only.
00:47:24
Speaker
So what happened was, I saw Unitez was our investor. So I went to Unitez to pitch for Masai School. It was like pre-series level, impact focused. So I went there to pitch Masai School. So I asked them, I want to pitch, can you give me Wi-Fi password? And they said that Wi-Fi password is profit and impact.
00:47:47
Speaker
And I told them, if you really want to create an impact, your password should be impact and profit because other impact over the property. And that line was the reason why, so they told me like, afterwards, that it was the reason.
00:48:09
Speaker
I was not thinking about anything. It just came naturally from how I was thinking. So yeah, I think impact is something which was decided. So the reason why I don't like to operate in K-12 space is because the impact of the outcomes that you are thinking about it is something which is going to happen
00:48:34
Speaker
like after a long period of time. And they're directly involved in the, the eventual outcome. Exactly. And whatever metric you are chasing, they are vanity metrics. So someone who got 65 in, in class, there's something which is a vanity metric. Correct. So there's no real outcome which you can measure. And that's why I always wanted to do something in higher education. And that's how me and Rupal Yogesh started Masai school in June, 2019.
00:49:04
Speaker
Yeah, who are Rupal and Yogesh? Rupal is my senior from IIT. Yeah, they are my co-founders. No, Rupal is my senior from IIT Kanpur. Yogesh I met through my wife's. So what happened was, earlier Masai school was
00:49:23
Speaker
It was not about programming. It was about teaching someone soft skills. But then...
00:49:40
Speaker
I was talking to my wife and then she suggested that you don't meet this guy. This guy is into sales performance training and he used to train to senior level folks in Swiggy. You should meet him. He is an amazing guy. So I met Yogesh and the guy after Yogesh has worked him.
00:50:00
Speaker
corporate on his life, like for is now 45 or 46, I think so. He has worked like for 20, 25 years in corporates. Okay. And I told him to basically quit corporates and come to startup and join me as co founder. And he joined.
00:50:22
Speaker
But, but Nupal was there. So then I, again, my love for programming was, was also there. So we thought that this is what we want to basically do. And for next 10 years, we long to programming. And that's where we should be basically focusing on. That's how the school started.
00:50:43
Speaker
So, was the format like a short duration course, like 2-3-1 bootcamp kind? No, no. Okay. So, it's an eight and a half month long course. Why? Help me understand your thought process to choose this because the longer the course is, the more time it takes for you to start monetizing.
00:51:06
Speaker
The kind of audience that comes to Masai, 65% of them have not done programming in the past. Around 75% of them comes from non computer science background. So they have not studied computer science.
00:51:22
Speaker
They wanted to make their career in programming. It's a pure zero to one school. So people who don't know programming, they need that much time to basically become programmers who can contribute into the tech jobs. So this is our full-time program. There is a program which we have for finally college students and working professionals. That's part-time. It is also eight, eight and a half months long.
00:51:50
Speaker
But the duration over there is only two and a half to three hours per day. You need a lot of first principle thinking. Fascinating. So tell me about your funnel. The top of the funnel would be like say the leads generated and the bottom would be people who complete the eight month course. Yeah. And in between you have these drop-off points like after unit one is a drop-off. Probably from leads to conversions also there would be some drop. So just talk me through that.
00:52:20
Speaker
So what happens is basically we don't have CAC in Masai. So around 70 to 80% of our students come from different and 20% of them come so organically. Every person have more unemployed friends than employed friends. So I get a quite experienced with that. That's how the referral kicks in.
00:52:48
Speaker
So what happens is like, uh, let's say a hundred people, um, or I'll start with, huh? So a hundred people give a test, uh, 30 people and clear the admission test in Masai. Okay. Out of 30 people, those who are in math and English, huh? Basic math, basic English, seventh, eighth grade level maths and logic. So a hundred log of it is that then the 30 of them clears, uh, out of 30, um,
00:53:19
Speaker
Like since we don't have any fees, the people drop off at any given point of time. Around 15 of them basically completes the unit one and signs the pay after place one. So, and after place one is signed after unit one only. After unit one only. Okay. So we select the students to sign pay after place one. So from 30, it reduced to 15.
00:53:46
Speaker
15, those who are there, there is hardly any drop. So there's less than 5% drop during the course. Or either we ask them to leave if they are caught in plagiarism. But to scale a wall, people who are moving it forward, they keep on moving forward. And then all of them graduate. So in our case, unlike the MOOCs or any of the online courses,
00:54:18
Speaker
The completion rate is as soon as someone signs after place, but it's like around 90%.
00:54:24
Speaker
Do you have some sort of capacity or can your unit 1 be of 500 students together? Can your cohort be of 500 students? Do you need to have more teachers if you're including the cohort size? I'm trying to understand how much of it is a pure product where if it's 10 or if it's 100, it doesn't matter.
00:54:48
Speaker
So we in every batch, we have around a thousand odd students, those who are there in unit. Okay. And it is not teacher dependent. So that's why it's so you don't need to basically like when you're scaling the students, you don't need to scale the teachers. That's the beauty of this model.
00:55:07
Speaker
What we do is we have something called as instructional associates in Masai. Instructional associates are basically the ones, those who are deployed in a way that they handle around 50 students. So one is to 50 is the ratio.
00:55:29
Speaker
and they basically are with the students throughout the day. So in IWY, in the Y part, they are involved throughout the day on doubt clearing on other things they are involved. And the beauty about instructional associates is
00:55:45
Speaker
They were the topper of the batch, which has graduated. So what we do is basically, let's say if this batch is graduating, we take the toppers that for the next eight months, you need to basically become an instructional associate. And then you need to graduate with the best that you are basically venturing. So in that way, they get salaries. Yes. Yeah. Okay. How much do you pay?
00:56:07
Speaker
So we pay, they have a package of around seven lakhs per annum. Okay. Pretty good. So they work as IEA and then they graduate with the batch that they were venturing. And that's how the cycle runs.
00:56:23
Speaker
Amazing. I love how you have made it into such an organic community. The fact that the previous batch is there with them as mentors makes it so much more... I mean, the experience is going to be so much more consistent. Correct.
00:56:43
Speaker
It's like what, you know, in the college fest and all, like you have the seniors who pass on the role and the next year's community or the club is formed. There's a pretty tough problem, right? Because there's like this eight month gap between the information and when you can act
Market Adaptability and Placement Success
00:57:02
Speaker
on it, right? Like if you see the market picking up, it will take you eight months to take advantage of that.
00:57:07
Speaker
Yeah. It's why you can't be very conservative. You can't be very optimistic. You need to keep the funnel going. We currently the scale on which we are operating, we are actually bigger than, you can say like around four or five by 80 is the number of placement that they do in a month. So we do like close to 250 to 300 placements in a month. Wow.
00:57:29
Speaker
So that's not that big a number. 300 placements a month and we are probably the largest in terms of the placements. And we'll reach there. So I think till the time you are placing around 5,000 students a month or like even 2,000 students a month. I don't think that macro condition has anything to do. The challenge that we had was most of the hiring partners.
00:57:58
Speaker
Like last year, April, the scenario here we were on is that we had more number of companies than we had. Okay. Always. That is the case. Okay. And that was consistently. So we had like, it services companies like this. So our students are working in over a thousand companies now. That includes around 22 unicorns. That also includes around all the major service giants.
00:58:26
Speaker
So our students are in like almost any community that you can think of right now working over there. And so our initial customer base was startups. April last year that we had one number of.
00:58:44
Speaker
companies. And we had like, it graduated from 20 batches, which are 100% placements. Okay. Right from 2020 to 2022, April. And then certainly, because of this funding, we do startups are the biggest one those who are recently.
00:59:00
Speaker
Those were hard. So we need to find out a new way to basically get more companies because startup, if they were hiring like 80% of them was our audience base and that suddenly becomes zero. Then you need to basically find out another way or another base, which is going to basically expand. So what we did was now, right now, around 80% of our students are going into mid to large service based companies and 20% of them are going into startups.
00:59:29
Speaker
So that is the change fundamentally that we did. Because the large service companies have seen these cycles in a number of times. Every four, five years they've seen this cycle. So they have already planned those things. Startups usually don't plan. I guess your goal would be to convince these large IT service companies, they typically
00:59:49
Speaker
send whoever they hire for a three-month bootcamp anyways. So if you can replace that where instead of that three-month bootcamp is they are paying for, they can hire someone who's productive faster, that could be a good value proposition for them.
01:00:04
Speaker
Yeah, so we work with a lot of IT service giants and we have actually signed a contract with some of them. Like for example, there's one big four who have hired close to 100 students in the last three months from high school.
01:00:20
Speaker
There is like Infosys, for example, have signed a contract with us to basically hire 100 students every quarter. Accenture, Techma Indra, all of them are actually working on the similar lines. So just a thought, you know, the fintech part of this, which is the lending is also...
01:00:37
Speaker
something where you're leaving margin on the table. It's like a rule of thumb that cost of capital is 16%. The NVFCs are charging 22%. So there is that 6% extra margin for you there to take if you were to fund it yourself. Or is that like biting off more than you can chew?
01:01:00
Speaker
It is going to be like, I think eventually anyone who is going to be operating in this space is going to basically move towards that particular direction where they'll solve this for tech day as well. At least if you'll become that.
01:01:14
Speaker
that large is an education institute. Like, for example, in our case, I think we can become a hundred million dollar revenue making company when 2000 students will start graduating from a high school every month, which means 24,000 students every year. So from that scale perspective, it doesn't look like a big scale, but 24,000 means all the IITs and NITs put together, that's the number of students. So
01:01:44
Speaker
So, yeah, I think there is margin that we know we are intentionally living on the table, but it has to be solved through, you know, in a more fundamental way. But I don't think that we have enough time backward to basically, I think it living on the table is like now is a better option. And do you need to raise more funds to achieve this or your already raised funds are enough?
Financial Health and Growth Plans
01:02:09
Speaker
So we already have funds. And I think we have with the current fund, with the current burn, we are, we have like a four years, always four years runway with the current set of funds. But at the same by the time, the idea is from June onwards, we are going to be cashflow positive. So this June. Amazing.
01:02:34
Speaker
So then you don't need to basically raise any more capital. It's going to be from the capital native race. We can build a great business from here onwards. And that brings us to the end of this conversation.
Audience Interaction and Feedback Request
01:02:46
Speaker
I want to ask you for a favor now. Did you like listening to the show? I'd love to hear your feedback about it. Do you have your own startup ideas? I'd love to hear them. Do you have questions for any of the guests that you heard about in the show? I'd love to get your questions and pass them on to the guests.
01:03:01
Speaker
Write to me at ad at the podium dot in. That's ad at t-h-e-p-o-d-i-u-m dot in.