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How to Compete With SaaS Giants & Win | Murthy Chintalapati (Ozonetel)
344 Plays2 years ago
"You need to find out what the pain areas are and what customers are excited about."
This simple yet profound insight from Murthy Chintalapati is the cornerstone of his multi-decade journey as a serial entrepreneur. In this episode, he explains how this relentless focus on solving real customer problems—not just building exciting tech—allowed him to identify a massive gap in the market and build Ozonetel, India’s first cloud telephony company.
About the Guest
Murthy Chintalapati is a serial entrepreneur with over 25 years of experience building deep-tech companies. After the successful acquisition of his first Silicon Valley venture, Intoto, by Freescale Semiconductor , Murthy returned to India to found Ozonetel in 2007. He pioneered the country's first cloud-based customer experience platform , scaling the company to support over 80,000 agents globally and achieving an annual recurring revenue of approximately $12 million.
Key Insights from the Conversation
- Solving the SME Problem: Ozonetel was born from the insight that Indian SMEs were locked out of the market by expensive and complex legacy systems from giants like Avaya, which they couldn't afford or manage.
- The US "Wedge": Ozonetel entered the crowded US market by offering a dramatically faster deployment time—going live in 24 hours versus the 2-3 months required by competitors—and providing seamless, out-of-the-box CRM integrations.
- A 50% Cheaper TCO: A key competitive moat is offering a 50% reduction in the total cost of ownership, not just through lower license fees, but by eliminating months of expensive system integration effort for the customer.
- Pivoting from APIs to a Product: Ozonetel initially launched an API platform for developers named "KooKoo," but quickly pivoted to a full, browser-based application when they realized their target SME customers didn't have the IT teams to build their own solutions.
- COVID as a Growth Catalyst: The pandemic served as a massive tailwind, forcing enterprises to adopt remote work overnight and rapidly accelerating the shift from on-premise hardware to agile cloud solutions, causing Ozonetel's business to take off.
- Owning the Tech Stack: From the beginning, Murthy's philosophy was to have full control by building the entire system in-house, including their own hardware cards, to ensure they could fix any issue quickly without relying on external vendors.
YouTube Chapters
00:00 - Intro & The Founding Thesis: Spotting the Gap in the Call Center Market
04:32 - The Zero-to-One Journey: Building Hardware & Finding Product-Market Fit
10:38 - Early Wins & Getting the First Angel Investment
14:19 - Cracking the US Market: The "Wedge" That Displaced Industry Giants
17:19 - Scaling Up: How Deep CRM Integration Became Ozonetel's Moat
22:16 - The Business of SaaS: Ozonetel's Revenue & Growth Strategy
24:35 - Investing in the Future: Building In-House AI and Voicebots
32:12 - Market Dynamics, COVID's Impact, and CPaaS vs. CCaaS
40:22 - The Founder's Role in Scaling a Global Tech Company
43:08 - Murthy's Core Advice for Aspiring Entrepreneurs
YouTube Hashtags
#FounderThesis #StartupIndia #SaaS #CloudTelephony #Ozonetel #MurthyChintalapati #Entrepreneurship #MakeInIndia #B2BSaaS #CustomerExperience #CX #TechStartup #VentureCapital #Bootstrapping #BusinessPodcast
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Transcript
Introduction and Podcast Goals
00:00:00
Speaker
Hi, I'm Muthi Chintalapati, co-founder and CEO of Ozone Telecommunications. Take me on a tour. Take me on a tour. Hello. This could be a great intro. Hi, I'm Akshay. Hi, this is Saurabh. And you are listening to the Founder Thesis Podcast. We meet some of the most celebrated sort of founders in the country. And we want to learn how to build a unicorn.
Disrupting Call Center Tech with Ozone Tell
00:00:32
Speaker
Companies have been running call centers since the 60s and millions of people around the world are employed to take customer calls and call centers. But the backend technology used by call centers has not really seen any major disruptions in the last two decades. The space is dominated by large MNCs like Avaya who sell complex and expensive products.
00:00:52
Speaker
This is where an Indian company like Ozone Tell has found a massive opportunity. Ozone Tell helps companies to set up a call center with just a subscription and basic integration, allowing them to go live in days instead of weeks and at a fraction of the cost charged by the global giants.
Founding Story of Ozone Tell
00:01:10
Speaker
Murthy Chintalapati, the founder of Ozone Tell is a serial entrepreneur with successful exit in the US under his belt. And in this conversation with Akshay Dutt, he talks about his multiple decade journey as a founder and disrupt. So I moved back and then we started Ozone Tell. You moved back, then what? And then of course I met Atul Sharma, my co-founder.
00:01:33
Speaker
Of course, I met him way back in 2003, still, when I was running in Rotom to a common friend. And of course, we didn't do anything in voice space that time, of course, we were just talking. When I came back, then we re-initiated, and then we came out with this horizontal radio.
Challenges for SMEs in Voice Solutions
00:01:51
Speaker
And then we formed horizontal and then got into the space. What was the gap you saw that, what was that basic idea?
00:02:01
Speaker
So basically Atul comes from an enterprise telecom background. So he worked in Avaya and Tell Me kind of companies. And so he had certain ideas in voice space and then we were dabbling with Avaya in our solutioning. And then we saw in the Indian market,
00:02:21
Speaker
the SMEs and all these guys cannot afford away our census scores. Not only the CAPEX but even the system integration expenses which you need to incur to put the solution together. So then we said okay. But I have one question here. Who is the
00:02:39
Speaker
Who's the buyer for these kind of boxes from Avaya and all? Are we talking of call centers here or are we talking of just regular?
Centralized Call Tracking System
00:02:48
Speaker
Because regular businesses would just be taking a BSNL slash MTNL line at that time. Or an A-tailor.
00:02:58
Speaker
Airtel with a PBX and the reception is sitting and taking calls. Or maybe there'll be a customer support team. The receptionist will route the call manually to them. So that's the kind of scenario existed at the time, right? So if you want to set up a series calls until you outsource your process to a BPO. Right? That's the trend. And so that means. And these BPOs are the ones who buy in a wire box. Absolutely. Absolutely. Yeah.
00:03:27
Speaker
So, but if you look at it, right, I'll give you a very simple example. So we use this Hyundai dealership, right, tried in Hyundai in Bangalore. So they have around 10, 14 offices within Bangalore. Some of them are sales offices, some of them are service centers. So there is no way the management can track the calls of what's happening within the business. How many sales calls have come? How many support calls have come?
00:03:51
Speaker
what exactly the sales guy spoke to this guy. So basically, if you don't treat this calls in a monitor this calls and see what the customer is asking and act upon it in a real time fashion, then you're losing business. And so and they also felt the need for some some tracking mechanism on the calls because
00:04:11
Speaker
The management cannot track the calls coming into 14 different offices sitting in one place. That's the gap which we found in the market where you need a centralized system where the calls flow through the centralized system into the branches and the management gets a real-time dashboard on their laptop and listen to the calls and act upon it.
Launching Cuckoo: A Cloud Telephony Platform
00:04:33
Speaker
This was when the cloud telephony companies had already come by this time, right? That's when 2010, 9 and 10 is when we started. Initially, we were trying to deploy Avaya by solution, but it's too complex and too much of effort to manage it. Then we built our own even cards, ISD and VN cards, and we built our own hardware. What is this card? What does it do? Basically, the cards which interact with the telephone exchange, the calls coming from telephone,
00:05:01
Speaker
exchange to your PBX. That's the hardware interface. So those cards we have built on our own. What we believed is whatever you want to do, you need to have total control. So when a support issue comes up, you should be able to fix it quickly. You can't depend on the imported
00:05:17
Speaker
card and depend on a vendor to fix all the issues. So we went out and built the entire system and hosted it in the data centers and started deploying the solution for across Bangalore and other places. So this solution was like a plug and play for the buyer or what was it like for buyer? Not a plug and play 8. There's a lot of hard work in deploying all these things in data centers. So it is not plug and play. There's a lot of effort is to go in and then
00:05:46
Speaker
What this would do is it would enable one phone number to handle multiple parallel calls and route calls according to some logic.
00:06:01
Speaker
And so 2010, we launched this cloud telephony platform, Cuckoo. We used to call it Cuckoo that time. And so that's when we, then what we found is we thought a lot of developers will come and use the APIs and build or run applications. Okay. That was the aim. Like parallel at that time, Twilio also launched in US at the same time.
00:06:21
Speaker
And in the US, there are a lot of developers who use APS and build around applications. In India, you don't have that kind of developer ecosystem, right? And moreover, even if they build something, they have to put effort in marketing and selling that. And when they make money, we will make money on our platform usage. Guys like Zomato or early adopters around 2010, so they used our platform from 2010.
00:06:46
Speaker
And what was the use case for Zomato?
Case Study: Zomato's Call Tracking
00:06:50
Speaker
Basically, they used to assign numbers to the restaurants from the platform. And when the call lands on the platform, on the backend, they used to map it to the restaurant number and track the call. So they can tell the restaurant, hey, so many calls got generated, inquiries got generated. Lead generation. Lead generation. Yeah. Yeah. This is when Zomato's main business was restaurant listing. Absolutely. Not a food delivery.
00:07:16
Speaker
restaurant listing, restaurant reviews, and things like that. Yes. I remember using this system. You would find a restaurant and then the app had a button to call and you click on the button and a call would go and you'd get connected to the restaurant and then you would tell them, okay, I want to order this. Will you deliver? Those days.
00:07:36
Speaker
And they just record the call because it's important for them to, in case tomorrow there isn't a dispute, right? So they have a call recording to resolve the dispute on the order or whatever it is.
00:07:47
Speaker
And also guys like ZipDance, you know ZipDance, give him his call. Right, which got acquired by Twitter. Yeah, they launched it on a platform at that time. So give him his call, get the crickets call. So we took them live in 24 hours on our platform at that time. So Kuber was like, I guess, and both of you would have launched it on the same time frame, but that also was launching around that time only. So basically, Chetineya was our architect who used to do all these things, put out all new things.
00:08:14
Speaker
in the public domain and launch the products and things like that. So he used to write the blogs also, what's happening, US versus India and things like that. So when we started looking around, a lot of SMEs, they wanted an out-of-the-box solution. They don't have teams to build anything, right? So they don't have IT teams to build. So that's when we build the entire contact center application on top of the same platform. And then we gave the Cloud agent, which is a contact center application.
00:08:45
Speaker
So we're in the first browser-based contact center at that time. And parallel in US, top desk launched on Twilio at that time. So we enabled SMEs. So this product would allow a company to tell their agents to just log in on a browser window and then start taking calls or make outgoing calls as the case may be. That's right. OK. And they would just have a headphone connected to the laptop for the conversation to happen.
00:09:13
Speaker
Absolutely. Absolutely. They don't need to put a hard phone. They can do that. And of course, since India has regulatory issues, you cannot call on a laptop. You cannot connect the call on the mobile phone, but the agent is logged into the browser so we can track the agent activity in real time and make sure that each agent is available to take the call.
00:09:33
Speaker
and the agent was not busy on the phone based on their skills. It's called skill-based routing. So all that logic is done on the data channel and the actual voice is connected on the mobile phone or a landline phone. And then later we gave a hybrid solution where we used to deploy a gateway at a customer premise and then connect all the agents on a LAN. So at that time they were able to take the calls in the browser.
00:09:57
Speaker
because once the call admits on a LAN within an enterprise network, you can legally deny the call and allow the agent to take the call in the process. And this law came into place because government wanted to protect the telecom companies. Otherwise, the telecom companies would have lost business if this was
00:10:15
Speaker
That was a notion, but it's nothing like a loss. In fact, you are enabling the businesses to use the more telecom infrastructure in this manner. So we did that. So we moved from pure cloud to hybrid, looking at the market requirements, the challenges you are facing in the market, and really took off. So we enabled
00:10:38
Speaker
And this was bootstrapped, no external funding. It's all self-funded, yes. And around 2015, we took some angel money from Singapore. Angels came together and they invested in us. What kind of business were you doing by 2015? What kind of revenue?
00:10:52
Speaker
We crossed a couple of million dollars at that time. At that time also we launched some innovative application called Mobile Radio for Hindustan Unilever.
Innovation with Mobile Radio for HUL
00:11:01
Speaker
If you've heard about it, it's called Khan Kojiratation. So they were trying to reach bottom of the pyramid consumers where they have a 1,000, 2,000 rupees, a future phone. They don't even have a smartphone. They don't have radios.
00:11:17
Speaker
or they don't have TV. So that's a media dark place. And they want to promote their brands in that segment, the UP Bihar kind of segment. And they floated an RFP and we bid it for that and they launched mobile radio and there's a Limka record for that, where we handled around seven or eight million missed calls in a day. So you give a missed call, you get a like a FM radio kind of incoming calls.
00:11:42
Speaker
FM radio kind of content with RadioJock is playing the content and then in between there'll be the brand ads like the wheel. I mean they have a hundred brands. HUL has a hundred brands so they can play whatever brand message they want to play. So they used to track how many times a particular consumer have heard this particular brand. So all those analytics we gave to them so they could do the promotions based on that feedback.
00:12:07
Speaker
And for the consumer, it would be just a missed call and then they would get an incoming call. So it was like free radio for them. Absolutely. It's a free radio for them. Right. Okay. Interesting. I had not heard of this, but yeah, it's pretty interesting. Obviously technology made this concept obsolete, but it was innovative. In fact, HCL got Khan's gold and silver awards at that time for these innovative advertising, innovative marketing, using the phones to raise the media dark people. Yeah.
00:12:36
Speaker
So, this was which year then? The HUL campaign? It was around 2014-15, around the time. Okay, around the time you got the angel funding? Yeah, I am. Okay. So, what made you take on external funding? What was the, what did you want to use the funds for?
00:12:53
Speaker
Yeah, so we, we went to a US two years back, 2018, the North American market.
Entering the North American Market
00:13:00
Speaker
And if you look at 70% of the global contact center market is in US. And that's a lot by value, because that the value would be high.
00:13:09
Speaker
value, the maturity of the market, and the maturity of the enterprises using the product is very high. And so we decided to address the North American market. Though it's crowded, people said, why are we going to the North American market? It's crowded. We said, let's go ahead and try it out. Other option we had was go to Southeast Asia, countries like Indonesia, Philippines, Thailand.
00:13:32
Speaker
And all those countries have their own dynamics. Unless in each country you have one founder sitting and understand that market and you make it happen, it's very tough to win that market. And also, they're as present as India market. So you don't get return on investment by going into those markets. So we said, OK, let's take a shot at North America. And it really paid off for us. And so we started getting inbound leads because of the content marketing efforts.
00:14:02
Speaker
We have some white label partner. The US was taking our product through channels. Channels like Avaya Partners. Channels like Telecom. They already have global presence in telecom networks. So they have partnerships. So they want to push this product into their network. But what was the VEDS? Like the US would have already got other companies offering cloud telephony, right? So what was the VEDS through which you could enter?
00:14:30
Speaker
Yeah. So as I said, it's a crowded market. Everybody said the same thing. And we said, we want to come here and observe ourselves than listening from others. So we started getting the inbound leads and we started, we put a dedicated team to understand the requirements and started servicing them.
Identifying Gaps in the US Market
00:14:50
Speaker
So what we found was the existing solutions in the market, they don't have seamless integration with the most of the CRMs like Salesforce and Zoho and things like that.
00:15:01
Speaker
Okay. And also the auto dialers for telemarketing purpose, like predictive dialers, progressive dialers, even they are not working seamlessly out of the CRM. What are these progressive predictive dialers?
00:15:15
Speaker
Basically, you want to do a lot of bulk dialing and connect to the agents. You need to automate all that process and there are the progressive and predictive dialers. That's what these two functionalities allow you to do bulk dialing and connect the call when the consumer picks up the phone. It connects the call agent so that they do whatever product they are trying to promote.
00:15:36
Speaker
Okay. Okay. Okay. So what we observed is most of the existing solutions are not seamlessly integrated. There are a lot of challenges. The customers are not getting good customer support. And so, and we found this as a gap and we started addressing that. And when we started working with our white label partner, we went into the channels like Avaya channel partner. So they validated our thesis that a support is not there. B.
00:16:04
Speaker
If you want to deploy a contact center in the US, it takes two to three months of system integration effort. That's a cost. There's a huge cost over here. So our solution is out of the box. It's a plug and play. And even to configure a simple IVR on an IVR gateway, it takes a lot of effort. In our case, you don't need to be a technical guy to configure an IVR. You could be a business guy.
00:16:32
Speaker
user IVR plug-and-play configuration and configure the IVR on the flight. So Daifon is a very user-friendly system and you can integrate with any backend system very seamlessly in less than 24 hours and you can migrate any legacy network or legacy contact center onto the cloud within a span
Shift to Large Enterprises
00:16:51
Speaker
of 24 hours. So you don't need to spend a few months to make those things happen. So these are the USP's we found in this market and now we are making good progress here.
00:17:00
Speaker
Got it. So essentially, you are doing in the US what, like, say, Exotel Nolarity are doing in India. See, Exotel Nolarity, so if you compare these three players, right?
00:17:11
Speaker
Exotel Nodality are addressing the SMB kind of opportunities where we have a call center with 10 to 15 or 20 agents. Over a period of time, we have moved into mid-sized large enterprises. But just to give you an idea, now we're addressing opportunities like SDFC, which is deploying for 15,000 call center agents. So that's the kind of scale we are talking.
00:17:33
Speaker
Okay, okay. So, therefore, the external nonarity would not be focusing so much on integrating with other systems. But because you work with large clients who would already have other existing systems, so for you, integration is a moat in a way, your ability to integrate, that is the moat. That's right.
00:17:52
Speaker
And so what made you build these integrations like you were also originally working with SMBs only? What made you choose to build like Salesforce and Zoho integrations and so on?
00:18:04
Speaker
So I mean, see the India market, if you look at customers like Big Basket, they started off with 10 agents in 2012. Right now, there are 1500 agents spread across Bangalore, Pune, and Hyderabad. So all these people, okay, Big Basket is an exception. They have a no CRM. They work with another partner called Capture CRM from Bangalore. But otherwise, most of the new age companies, either they use a Salesforce or a Zendesk kind of CRM. So, and if you want to make the agent productive,
00:18:34
Speaker
You need to integrate with the CRM. So when the call comes in, the agent should get a screen pop with your customer history. Okay, so Akshay is calling. He has given me his car for servicing on xD. So all that history will pop up on his screen and he will greet you. Mr. Akshay, you gave your car for servicing and whatever it is. So he
00:18:55
Speaker
He handles you in a very personalized manner. So you are setting your customer satisfaction right then and there. And I'm not putting you on hold to retrieve your information.
Importance of Customer Experience
00:19:05
Speaker
The information is right in front of my screen while I'm talking to you. So the customer frustration will come down. I still don't understand why every time I call ATEL, they put me on hold. Yeah, absolutely. Yeah.
00:19:21
Speaker
If you look at the business right now, everybody is moving to customer experience. Forget about call center. Customer experience is the key for you to succeed any business. Amazon has set the gold standard in customer experience. The customer can come on any channel. It could be voice, it could be email, or it could be SMS. You should be able to respond to them in real time. If you don't respond to them in real time,
00:19:51
Speaker
the customer is going to your competitor. So they have options. It's not that they don't have options to deal with us, right? So it's very important that now businesses implement technologies like CRM, contact center, boards, so all these things so that you service the customer or the channel he prefers at the time he wants to interact with you. So you can't say they call between 9-5B.
00:20:16
Speaker
I'm available only between 19. The customer can call you at 10 p.m., right? So that is the time he's free. So your customer support team should be able to address his issue at that time using a physical agent or a bot. And the bot or a physical agent should access the CI information on the flight. You can't keep the customer on port, like where you went through the frustration, right? And one of the frustrations all of us go through is IVR. I mean, you keep pressing the different option, but still... Yeah.
00:20:44
Speaker
We don't get a solution. So how do you design that IVR which is very user friendly? So now all these technologies are enabling businesses to deliver exceptional customer experience. And also you maintain the life cycle of the customer. So right from marketing stage when you acquire the customer to convert them into your sales,
00:21:05
Speaker
and then from sales to support, both sales support, and then the loyalty phase. So how do you make sure that you retain the customer and sell more and more? The customer support is normally just a support, and the customer support guys also cross-sell other products and other services.
00:21:20
Speaker
So you have to enable the support agents, support executives, all the information possible about the customer so that they maximize the revenues. Got it. Okay. So in terms of milestones, like one milestone was 2015 when you raised angel funding, then second milestone was 2018 when you entered US. Is that the last major
Expansion and Fundraising in 2021
00:21:41
Speaker
milestone? We raised our CDC in 2021, October.
00:21:47
Speaker
And we raised our first round. And the reason we raised is we want to expand in North American. We want to invest in North American market. This creates more into marketing and sales. R&D is taking care. Okay. We have to continue to innovate. That keeps happening, but we raise the money to expand into North American market. Okay. Before we go to market and growth, basically. And to build a brand in the North American market. So there are a lot of events you have to attend and make yourself known in this segment. Yeah.
00:22:14
Speaker
So how much did you raise in your series? We raised around 5 million. And what revenue did you close last year? Like what's your current revenue now?
00:22:23
Speaker
We are talking around 12 million ARR. Yeah. So this funding will allow to double that in the next 12 months. Oh, wow. OK. And how much of this comes from India? How much from US? What is the split? 70% comes from India and 30% from North America. Yeah. So how good to expand North American revenue
Scaling and Integrating Voice Bots
00:22:44
Speaker
set. And are there different product lines or is that one basic product line of voice only? Like for this revenue, like
00:22:53
Speaker
So basically, CCAS stands for contact center as a service. So that's the main product. So we're trying to scale that revenue. Which is basically a plug-and-play... Contact center. So we continue to grow that, scale that, as we start deploying bots in the market. So what would a bot do here? This is a voice product, right? A voice bot.
00:23:17
Speaker
Yeah, it's a voice bot, or it could be a chat bot. But we being in the voice, probably we have a better understanding of how well we can service the customers on the voice, right? So we have voice bots, which we have. So that voice bot is a replacement of the, like, instead of saying press one, the voice bot will say, say one. Is that what?
00:23:37
Speaker
And also, it will not only say when you can say, OK, my shipment tracking number is this. OK, OK, OK. Then it will drop to the back end CRM and pull out the information. It is a very simple query like that. When the query becomes a little complex, then the bot definitely will fail at some point. And then what happens is the bot has to hand over the call to an agent.
00:24:01
Speaker
And the agent should have the history of what all happened till then so that you don't ask the customer to repeat everything. And then he takes over from there. And so the kind of support executive you need at that point is a little bit of a subject matter expert, not just a guy who will take your name, number, to track information, but he can address complex questions. So seamlessly, you have to transfer to the customer support executive and get the problem resolved.
00:24:31
Speaker
OK, OK, and you are building this WiseBot in-house. Yes, of course. Yeah. And we also are building a lot of speech analytics and conversational analytics. So we record all the calls. We run our algorithm to see what are the keywords which are happening between the consumer and the agent. So let's say you're ordering a pizza. And so you might be ordering pizza with certain toppings. So you have an issue with your order. So you can track
00:24:59
Speaker
All these in various buckets and do analytics on top of it and give a dashboard to the business guys of the, in this case, the delivery guys. And so they now they have a lot of intelligence in the conversations which are happening with the consumer and they can fine tune their business based on that. Okay. Okay. Okay. It gives them access to voice of customer in a way like they can get an overview of what are the major keywords that people are using when talking to our agents.
Investing in Voice Recognition Technology
00:25:27
Speaker
and also the sentiment analysis you can do. So if the customer is frustrated or happy, based on that, you can do a lot of analytics around that. So this would work for the US market, right? Because I think Indian accent is still something which voice bots struggle to recognize. And I'm speaking as a podcaster. We run our podcast through an auto machine transcription tool, and we see very poor accuracy rate in that.
00:25:57
Speaker
So maybe we should try your transcriptions through our engine and see what. OK, that would be interesting. You give us 200 hours of your recordings, we should be able to figure it out. Of course, yours is a broad range of topics. Talking about Pisa Heart, the vocabulary used in Pisa Heart is limited. So if I get 200 hours of voice recording files, definitely I can get you 80% to 90% accuracy of the recognition.
00:26:23
Speaker
Okay, okay. Even with Indian accent. We did this with US. US is easier. As I said, India, the accent differs from region to region, right? Yeah, within English, but you have to put more effort in fine-tuning that. Yeah.
00:26:37
Speaker
So this is like your investment to remain relevant for the next decade in a way. Absolutely. Like machine learning based voice recognition technology. So this voice chat work would even be able to, like maybe not today, but eventually would be able to have like a conversation with the customers with something like, hello, how can I help you today? The customer stating a problem, like would that happen?
00:27:08
Speaker
It's a long way you can't have a free flow conversation with the board and expect that board to resolve without failing we're not there yet so if you have a limited vocabulary and you're using sentences around that you have to keep fine-tuning the board from day one you will not be able to do it but over a period of time you can increase the accuracy. So what is going to be your path to a hundred million dollar error what do you think that
Growth Strategy for North America
00:27:33
Speaker
will be.
00:27:33
Speaker
So yeah, as I said, we are betting on North America to get there. And these are all pure SaaS revenues. And so we are taking a couple of approaches. One is direct selling online, the using content marketing, demand generation, marketing efforts where a lot of inbound leads are.
00:27:49
Speaker
address on the or the phone itself. So we will not have a huge sales team to do that. But then we have we're signing up a lot of channel partners in the North American market. So that will take time. But once it takes off, that will scale very fast selling to the channels.
00:28:05
Speaker
And so right now we are not going after the enterprises. We are more focused on mid-size market in North America. Once we build our brand and in next year or so, then we can start slowly address the enterprise opportunities, which we are trying to sell through the channel partners.
00:28:22
Speaker
because they have relationships and it's easy for them to sell to the enterprises. In fact, already through channel partners, we are able to compete against the finance and genesis of the world. So these are the market leaders and we're able to replace them a few accounts. Just because of the relationships, the channel partner is able to get into the account. After that, we're able to demonstrate and the ease of using the product and all that stuff, just convince the customer to go with us. Yeah.
00:28:49
Speaker
Do you also offer a cost advantage? Is your product cheaper than, say, a Genesis? You get a total 50% on the total cost of ownership, not just the license fee. As I said before, it takes anywhere between two to three months to deploy a finance or a Genesis to implement their solution. So you can cut down that effort so that three months of cost, the customer can avoid.
00:29:14
Speaker
or save rather, right? Not only the time, he can save the cost there. And apart from the licenses cost, right? So straight here, we can offer a 50% savings on the license cost itself. And backed by high-touch, wide-glow customer support.
00:29:31
Speaker
So that means right from onboarding the customer to post-sales support, you're always there and that's what the customers are liking it here. Because your customer support and customer success team is in India, so that gives you that advantage to provide more high-touch service than a company based in the US because it would be expensive for them to match that.
00:29:54
Speaker
Not only that, in India, we got used to the high-touch support. In India, the customers expect you to be available to help them in a lot of ways, even simple IBR configuration. So our DNA isn't built around helping the customer to succeed. So the same thing we are carrying here to the North American Mall.
00:30:13
Speaker
Can you help me understand what is the pricing like? You know, what is the cost of ownership like? Is it on like per seat or is it on number of minutes or what does it look like? What is this product price like? It's per seat basis. Okay. And so if it's five nines, they charge around 125 bucks per agent license fee. The dollars you're saying? Yeah. In dollars. Yeah.
00:30:37
Speaker
So we can offer it at $65, $75. Okay. And unlimited minutes. It doesn't matter how many minutes of calling happens. No. So we give the option, they can use our trunks and we charge for the minutes extra for the usage, or they can bring their own trunk. Okay. So what is trunk? I mean, the, the, the telephony trunk, they can subscribe for a sip trunk. Okay. Okay. The, the four lines.
00:31:03
Speaker
the phone lines from the Telco AT&T, or where it is Verizon, or it could be any provider, and they can bring that, and there are multiple guys, like even video offers, Telnix, Bandwidth, there's so many guys who offer this app in the US, so they can get a chunk of their choice with commercials, negotiation directly with them, and they can donate on our platform, and they pay the call charges to the service provider, and they pay a license fee to us.
00:31:32
Speaker
So that call charge is not really a profit center for you. That's just an add-on service that you're providing. It does give a lot of profit if we charge them. Okay. We see tremendous margins on that. It's not just a pass through. Most of the time the customers prefer to bring their trunks and we allow them to do that because so we want to make it frictionless business. Yeah.
00:31:55
Speaker
So there is this other term which is CPaaS, Communication Platform as a Service.
Focus on CSaaS and Future in CPaaS
00:32:00
Speaker
So is that a market that you would also be positioning yourself in or you are focused on CSaaS like call center as a service? Can you differentiate CPaaS versus CSaaS? What is the difference? So basically CPaaS is a communication platform as a service where you're abstracting the telephony lines which are coming into the platform.
00:32:23
Speaker
and exposing the APIs wherein the end customer application is going to call those APIs to
00:32:33
Speaker
connect the call, answer the call, disconnect the call. These are some seven, eight commands, which they can call from their application. Okay. And, and they can use any web application, web technology they want to be Java, PHP, or Perler. There's so many web technologies. So they can use any technology and start programming at CPAS level, but the application intelligence, everything resides in their control and they do whatever they want to do. And we don't get exposed to what they do. Right.
00:33:01
Speaker
Okay. Okay. So CPaaS is more of a API service. It is meant for product companies to incorporate into their product. It is not for end users.
00:33:12
Speaker
Absolutely, absolutely. Yeah. So it's more marketed to the developers of any enterprise or the startups which are doing innovative things and they want the communication channels in their application. So this is targeted towards them and that's one. We have not really aggressively went after that marketing efforts because in India now it is taking off. So we would be putting a lot of effort in marketing now, even at the CPAS layer.
00:33:41
Speaker
Seacast is our plug and play solution and our main product, which we want to scale it, both in India as well as in the US.
00:33:54
Speaker
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00:34:24
Speaker
No, it's a plug-and-play solution. So he just logs into the cloud and as an agent, he will log in with his skills that is receiving the calls or making calls based on the logic. So in general, this space is seeing a lot of consolidation, like you got acquired by GAPSHAP and Twilio has been acquiring a lot of companies. So Twilio is probably the biggest CPaaS company in the world, I guess.
00:34:48
Speaker
So, do you see that consolidation also affecting Ozone? Tell either you acquiring or you getting acquired? It depends about the strategy of others, right? So, yeah, there's a lot of consolidation happening and for instance, sub-ship acquiring Nolarity. So, they would be using their voice services. I don't know about the contact centerpiece, but at least definitely they'll use for that. Filio acquiring, what is the company? They acquired a company in SMS space in India.
00:35:18
Speaker
So Twilio is known to be the market leader in the CPaaS with SMS is the main service more than voice, right? So they send billions of SMSes through that platform. So that's the reason they acquired. Yes, yes, yes, yes. And email also.
00:35:34
Speaker
Yeah. So they do have a contact center product called flex, but again, they are targeting that to the developers, not to the end user. Okay. So always they focused on developer community than end user community. Okay. So that is still not a threat to us. Okay. And so we are more appealing to mid-size market where they don't want to.
00:35:54
Speaker
do any development. They want a plug and play solution. They want ease of use with better support. So we continue to expand both in India. We don't see a challenge at somebody say coming into contact center space or at least in the mid-sized large enterprises. Okay. Okay. So, so there is no other company in India, which is doing this, like the, all your competitors are like Genesis. These are like all US based companies.
00:36:19
Speaker
Yes. Genesis, they focus again on a lot of enterprises. Okay. A lot of enterprises. And again, as I said, the regulatory issues in India, like you can't mix pasting and void. Oh, that is still there. They've not abolished it yet. Yeah. Yeah. So that's the reason we are from day one. We architected our platform, keeping that in mind. And we built out a very distributed architecture and that helped us in even in North America.
00:36:48
Speaker
I would have thought that considering all telcos are now also data companies, they would have done away with that rule. So it's surprising they have not. And however, you would be a juicy target for someone like Salesforce, right, in terms of acquisition. Like say, if a Salesforce wants to offer a more holistic solution to their customers, it makes sense for someone like them to
00:37:10
Speaker
Yeah, I mean, for them, it's a build versus buy and all that stuff, right? So how fast they want to get into the market to address this? So should they build it from wound up or acquire a company? And what we have seen is the contact center application is complex, particularly when it comes to voice. For the digital channels, it's easy to build a contact center, but for the voice, because you can't expect to have a lag in the voice and jitters and voice quality has to be of top quality and 99.99% uptime, all these things are there.
00:37:40
Speaker
So more so in India, it's very tough to achieve 99.99% because of our telecom infrastructure we have. So in the US, it's relatively easy to get that 99.99%, but not in India. Yeah, to answer your question, any CRM provider, if they want to expand their portfolio of solutions, the next stage for them is to acquire a CCAS solution. If their game plan is to provide a customer experience platform, not just a CRM,
00:38:08
Speaker
Then they need to acquire all these components and give a comprehensive CX platform. Yeah. Or even someone like say yellow.ai, which is again a customer experience company, but they are more on the text. Bot side. Yeah. Chat bot and all of that. What is the size of the company in terms of headcount?
00:38:29
Speaker
We're running 200 people now. We're expanding rapidly now because of our expansion globally. We're not just North America. We are going into the Southeast Asia and the Middle East because of our partners. So that market is driven from India. And so North American market is totally different here.
00:38:47
Speaker
Okay, okay. And you have salespeople in these countries or sales trends from India only? Right now, sales is driven from India. We don't have sales presence in Southeast Asia or Middle East. That is being handled from India and pretty soon probably will have presence in those countries. And was there like a tailwind due to COVID that
Impact of COVID-19 on Cloud Adoption
00:39:05
Speaker
you saw? What was the impact of COVID?
00:39:07
Speaker
Yeah. So in the first month or two, we saw some dip in the revenues because our end customers went out of business, particularly the travel, hospitality, who got affected by COVID. They stopped using our services. They are not able to pay. All that stuff happened. But immediately recovered and we saw a tremendous growth. I mean, ironically, thanks to COVID, our business
00:39:31
Speaker
really took off. And the good thing is a lot of enterprises went remote, right? And they adapted cloud very fast. Previously, they used to take nine months to make a decision, but now they said, implement it tomorrow. I want it today. So in such a daring hurry, they had to enable all the support executives sitting at home.
00:39:51
Speaker
For us, there's no special effort from us. It's just configuring the platform to allow them to take the calls from their phones at home. That whole remote work trend is something which would have forced companies to adopt better CCAS. Instead of an Avaya box on-premise, they would need a cloud-based, browser-based solution.
00:40:13
Speaker
Yeah. Browse a bit. Yeah. So what is your role in the company? Like, what do you look after and what, what keeps you up at night? So my main focus is on business side. Okay. I don't focus on the product or engineering. My two co-founders take care of that extremely well. Okay. To tell you, I mean, we are more technology driven than sales driven or marketing driven till now. In fact, the, we always believed.
00:40:40
Speaker
The platform we're going to create should be very robust and enterprise class. And that's what we achieved in the last seven, eight years, which is enterprise class in nature. And so now we are stepping up gas on the marketing and sales effort, both India as well as the other regions. And my focus is more on marketing and sales on the business side, on the business side of that. And what keeps me effort, that's it. And scaling the company to the next level, that keeps me awake. Yeah.
00:41:06
Speaker
Okay, so tell me something. One approach to grow could be like the Freshworks approach. Freshworks also started with SME, but now they're more of an enterprise company and they essentially raised a lot of money to spend aggressively on sales and marketing.
00:41:23
Speaker
Yeah, I believe Greece is now based in the US only because that is where I think most of the revenue comes in from. So that kind of aggressive funding led approach could be an approach that you could take. What's your thought on that?
00:41:38
Speaker
Yeah. So we have not taken so far because in India, when we were doing business that time, there are hardly any VCs willing to bet any venture, which is just focused on India market.
Advice for Aspiring Entrepreneurs
00:41:49
Speaker
So, and we focused only on India market for the last seven, eight years. And as you have a global revenue, they are not ready to step in. And now we have the North American presence. And so maybe the next round we'll be raising a bigger round in the next six months. Oh, we have, we plan to raise bigger rounds in next series B and CDC.
00:42:08
Speaker
I mean like going through channel partners would possibly save your cost of go-to market but then it would also reduce your margin right because you would have to share that margin with the channel partner. Yeah that is true but to get into entry into enterprise it is easier to go through a channel partner than a direct sale right and direct sale needs a branding and all that stuff that is pretty expensive in the US it takes time right unless you
00:42:35
Speaker
You take 50 million, 100 million funding and start pumping that into events and webinars and all that. We are to participate in the 10, 15 events which happen throughout the year. So once you start building your brand, then it becomes easy to get into enterprise. But still, it's not that easy because you have to displace, though Awaya is a legacy technology, but still they are a force to recon with. And you have any space behind. And so it's not easy to trouble them in enterprise account unless you have a relationship.
00:43:03
Speaker
And that relationship is what the channel partner brings to it. Cool. So let me just end with this one last question. So what is your advice to aspiring entrepreneurs?
00:43:13
Speaker
go and try it out I mean don't hesitate and definitely I mean it's not easy but you have to get used to it initially you will find it tough if you survive first year then it becomes easy to build a venture if you lose your heart within one year and a couple of years then of course you don't get success overnight particularly if you're working out of India so you have a lot of challenges so so you need to have that passion and perseverance to succeed in India
00:43:37
Speaker
In India, if you're addressing the India market, it's a very price sensitive market. It's very tough to build a business just on Indian customers. So you need to have a global strategy from day one, which we didn't do it for various reasons. Ideally, we should have gone to the US from day one, and then we would have met with a different success.
00:43:55
Speaker
So the advice is stay focused and don't get carried away by what is happening in the market. A lot of people will do a lot of things and a lot of funding activities happens. You don't focus on those activities, focus on the customer and the product. That's it. Everything else is a noise. So if you want to succeed, do that.
00:44:14
Speaker
If you like the Found A Thesis podcast, then do check out our other shows on subjects like marketing, technology, career advice, books and drama. Visit the podium.in that is thepodim.in for a complete list of all our shows.