Building Marketing & Sales Engine for Your Global B2B SaaS Product

Recently, India has seen many success stories of product startups in the SaaS category, which are building products for the global market. Here is what we did –

Suresh Sambandam, Founder and CEO of OrangeScape (the company behind KissFlow), in collaboration with the iSPIRT team, conducted the 49th #PlayBookRT on building SaaS products for the world. Sokrati (Pune) played a gracious host for this event, and saw around 14 product entrepreneurs from different cities.


Avinash Raghava introduced Suresh and the RT was kicked off with a round of introduction from all the participants.

Suresh laid out the purpose of the round table and defined the scope. This PlayBookRT was for the B2B SaaS startups with a product that has a global audience. These companies have achieved a product-market fit with a MRR (Monthly Recurring Revenue) in the range of $1K to $5K. These companies are looking to move the needle to $50K-$100K MRR. Essentially, early startups that are looking to grow at least 110x.

B2B customers need to be segmented with certain metrics. For KissFlow, the number of employees was a key metric to identify customer segments. The segments were –

  • SOHO (<10 employees),
  • Very Small Business (10-50),
  • SMB (50-500),
  • Mid-Market (500-5000) and
  • Enterprises (5000+)

Depending on your product, you may segment the customers by their revenues.

It is unlikely that your product will work across all segments as it is. The sweet spot for KissFlow is the SMB and Mid Market, as the value proposition is stronger for these customers. You have to pick your own sweet spot.

There was some discussion on why Enterprise segment is different from the others. There were multiple views on that. It was discussed that the marketing and sales processes are different for large customers. Their buying process is different too. They want “vendors” to come to them. Often, the product itself doesn’t work. Example – for KissFlow, Enterprise’s would need integration with their existing systems like SAP or Oracle. The SMB or Mid-Market customers do not have such requirements. For enterprises, you may have to package your product as a custom solution. Instead of the entire company, you may find it easier to get your product rolled out in a specific department.

The Mid-Market segment opens a big opportunity in US market. Typically, in the US, $5,000 is the approval limit in this segment. Most of the SaaS products fit in this limit. That makes decision making easier and fast. These companies are willing to spend money on products that help them compete with big guys.

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The discussion then moved on to the core elements of a successful SaaS business.

The role of the product in SaaS is very high. For enterprise products, the product comes at the end of the sales cycle. For SaaS products, the opposite is true. So, your product has to solve a problem.

While product is at the core of your business, marketing comes before the product. Your marketing communication needs to match the product promise.

Before accelerating your marketing, you need to decide on the product positioning. Your product is either a category creator, or provides a novel approach to an existing and well-understood category, or low cost alternative. Often, most of the SaaS businesses will fall in the second or third category. It’s also possible that product positioning could be mix of last two categories. The category creator products are hardest to pull off. The low-cost alternative need not be a low-priced alternative. Being in India, we can enjoy the advantage of low cost structures. Some companies do pass on the cost benefits to the customer via low price. While offering a low price option, it is important to ensure that you are not perceived as a low-quality option.

The next topic of discussion was offering a Freemium product vs Free trial. Often, for SaaS, this choice does not depend on the cost. The general consensus seemed to emerge that a free trial is the best option. Even if it doesn’t cost you much to offer part of the product for free, the effort to convert that free user to being a ‘paid’ user is high. Plus, when the user is ready to pay for the product, the user still may go out to look for other options. There are “free” products that make you pay with say a link to their website. This is not really free as your customers are paying with a different currency.

Like all discussions, this one too took a detour and we discussed about sales for the global customer base. To serve the US market, you need to have a night shift. For KissFlow, the newly signed up customer receives two emails – one automated and one personal email. The automated email is to schedule a demo of the product. KISSFlow has reduced the friction to sign up dramatically. You sign up with just an email. They have a team to find out information about that person based on the email address. All the new leads get assigned to the sales team automatically based on timezones and available bandwidth with the sales team. Each sales person handles about 200 leads per month with an annual contract value of less than $5,000.

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The next topic of discuss was pricing. People visit the homepage and then the ‘pricing’ page. They are qualifying themselves by looking at pricing. There are various ways to price your product. For the well-established category, competition will be a huge influencer in your pricing. You can also price your product based on value offered, though, you need to clearly demonstrate the value of the product. For KissFlow, the anchor was Google Apps. At the start, they focused on a niche of companies who have adopted Google Apps, which costs $5 per user per month. So, they picked the price of $3 per month.

For SaaS companies, raising the prices is usually not a problem. You can grandfather your existing customers who will continue to enjoy the same price, but the newer customers will pay a higher price. The real problem is lowering the prices, as it upsets existing customers. If your customers are not complaining about the prices, you are leaving money on the table and you should raise the price.

You should make users pay every month irrespective of their usage. You shouldn’t have to sell your product every month to the customers. That’s why your customers need to keep paying every month. Setting the expectations also ensures that customers are not thinking about pricing often.

Marketing was the next topic of discussion. Your website is a core marketing asset. You should avoid outsourcing the site development and have an in-house team for updating and maintaining the website.

Your home page should have a crisp headline with some value proposition. Jargon should be avoided. Make it easy for customers to understand and take a decision about your product. You should create a “customers” page for social proof. Highlight your major customers on this page. If you are running a blog, it will have visitors who are not aware about your product. You should create ads for your own product and run them on your blog.

You can use SEO and AdWords to bring the organic and paid traffic. SEO needs a lot of time to ramp up. So, start early with a dedicated team, even if it is a one-person team. AdWords needs a specialist to handle the paid traffic. Here, you can define your key metrics like costs per sign up. AdWords can deliver a sign up at $10-$25 for search and $2-$10 for display ads. These are only sign ups and not conversions. You need to measure conversion to paid subscription. That would be your true cost of customer acquisition.

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You need to have a responsive site as mobile traffic is growing. Even though most business users will sign up for your product with a desktop, they might discover your product on the mobile (maybe while reading a blog). They need to have a good experience when they are on mobile.

You can run re-marketing ads. This will provide you multiple opportunities to reach out to the user. Test out different messaging in the re-targeting. You can do smarter remarketing by finding the users’ point of interaction. For paid ads, start with only the US and then keep adding more countries depending on the quality of the traffic. There was a brief discussion on content marketing, focused on the disciplined approach to creating valuable content that will start delivering results over a period of time.

This was an excellent round table that covered most of the aspects of building SaaS products for the global market.

Contributed by Shashikant Kore, Co-founder of Karooya.

Chief Economic Advisor is Infected Positively by the Irrational Exuberance of Indian Product Startups.

Mr. Arvind Subramanian, Chief Economic Advisor to the Government of INDIA, has been named as one of the world’s top 100 global thinkers by Foreign Policy magazine. After stepping into the shoes of Dr. Raghuram Rajan as Chief Economic Advisor, he is also a widely cited expert on the changing Balance of Global Economic power, as it pertains to INDIA & China. He is also the author of “INDIA’s TURN: Understanding the Economic Transformation“. Mr. Arvind specially travelled to Bangalore to interact with software product industry and discuss policy with the the policy team of iSPIRT Think tank.


In the 4 hour meeting, the energy that emerging companies brought out with each presentation was amplified as the discussion progressed. In the end, I must admit that there was a euphoric feeling that this movement of creating public goods with the Social Commons model is really on-to-something BIG!

Not all elements of the session can be reproduced here, but this article is an effort to provide you the important highlights.

2015-05-28 17.36.55What was so Infectious? Its the Mirror Neurons, Stupid! 

In the first session, as it has become customary, about 8 carefully curated product startups which started in INDIA, with audacious aspirations, and which have already made significant GLOBAL impact while still retaining their Indian-ness, presented their stories. Almost every story was about Product Entrepreneur’s who dared to dream BIG, not just from themselves but for leap-frogging INDIA and the world. The Goal set out for the session was to show-case the behind-the-scenes transformation that is taking place in the software Product Industry landscape.

The Irrational choices of many Entrepreneurs were show-cased in their business avatars, as NowFloats, Uniken, Tally, Forus Health, Team Indus, FreeCharge, SnapBizz & Ezetap. While the strategy choices seemed Irrational, the success these business are having today, and the impact they can have tomorrow to reclaim India’s glory was self-evident. The outcome of the session was remarkably different from the goal the session set-out to achieve. What became apparent as the session progressed was the infectious effect it was having on each participant in the room. It was as if the Mirror Neurons from these passionate Entrepreneurs was affecting not just the minds, but it was affecting our Inner Spirit. The Infectious nature of the session’s outcome in many ways mirrored the outcome of these businesses.

2015-05-28 17.37.06What is the Cure? More Infection. Make India Go Cashless.

In a thoughtful next session the discussion moved toward more earthy and material realization of how Technology & Infectious energy of the startups can be leveraged to leapfrog INDIA. This discussion was about how to make India Go Cashless in 4 years. The benefits of going cashless are many. It can expand micro-credit to small businesses in a big way, for even street-hawkers (Thelewalas) to be able to digitally get credit and also seamlessly receive money from customers. Sanjay Jain (iSPIRT Open API Expert Team member, former Chief Product Officer of Aadhaar) and Abhishek (iSPIRT Colunteer, CEO Eko) presented a comprehensive approach and suggested a new Program, Jan Samridhi, for the Government. This builds on the Open API work that iSPIRT has already done (in eSign, UPI and GTSN) and proposed specific and inter-related policy and regulatory changes. The only real way of achieving this is to have more agencies in the Government, the Regulatory institutions and people to participate. So in effect, the cure really is to infect more people with the Spirit of Social Commons. The discussion clearly bridged some the intellectual distance between Delhi and Bangalore.

Advice from the Chief Economic Advisor

Mr Arvind, in his own-words was blown-away with the enthusiastic zeal and business performance of the Product Startup Ecosystem. He however was also clearly in his elements as he carefully constructed the broader picture by taking the various elements from the Individual presentations. Some of his suggestions and advice to the Startup community were as follows.

  • How soon can we marry the Private Entrepreneurial zeal & Public Goods created by such movements?
  • Can we use and leverage the existing products automating, say, Govt Fair Price shops?
  • While mildly chiding Product Entrepreneurs to dream even bigger by including Government, he asked if we can help realize other broader over-reaching goals like Government Technology Platforms for Expenditure tracking?

He even offered to visit Bangalore and participate 2-3 times a month in various such initiatives to enable routine conversations with Policy Makers and Entrepreneurs.

2015-05-28 18.27.33Conclusion

The entire program was highly Interactive, Infectious & Confidence building. It gave a sense that may-be within 4 years we can Make India go cashless. It also re-affirmed the new Paradigm of creating Public Goods with a Social Commons approach (Open source approach). It is important to co-create a digital INDIA, not just with the Entrepreneurial zeal, but by getting Government and Institutional bodies involved as well. These Infectious power-packed dialogs that iSPIRT is fostering will help us rewrite the script of our Nation, and will help us reclaim its lost Glory. We will become a Product Nation soon, it seems inevitable. Be a part of it now. Go ahead, spread the INFECTION, not just the word.

Era of Open APIs

APIs are important public goods that must be done right. They must not be held captive to commercial interests. This is why iSPIRT is helping Government in this area. iSPIRT’s work is inspired by Open Source movement and IETF methods. It fits with our charter of creating public goods without public money.
GSTN teamOur Open API effort is based on some core principles:
– Like IETF, iSPIRT is not a member organization. Participation is “People, not companies”.
– “Design is a team sport”. Focus is on building a modern architecture for country-scale technology systems.
– iSPIRT API Teams have people who are “Competent experts that are completely free of conflicts”.
– Technical decisions emerge from intense discussion. They are informed by prototypes, not theory. Motto is: “Code walks, bullshit talks”.
Today Economic Times carries an article about this Open API effort.  The article conveys the progress that we are making. More is on its way.
Source: Economic Times

We will soon be launching a micro-site to build engagement with your community. Watch this space.

Finance Secretary – interacts with Product Industry in Bangalore.

Mr. Rajiv Mehrishi promises deeper Institutional Reforms

Mr. Rajiv Mehrishi, Finance Secretary, Ministry of Finance for Government of INDIA, is a pro-reforms, vocal advocate of institutional transformation of the Financial System in INDIA. Additionally, he is also  the Secretary, Department of Economic affairs. Mr. Mehrishi and his team – Mr. Manoj Joshi (Jt. Secretary), Mr. Ajay Shah (Head, Macro/Finance Group, NIPFP), Ms. Ila Patnaik (Principal Economic Advisor) and Mr. CKG Nair (Advisor, Capital Markets) – specially traveled to Bangalore to understand the software product industry landscape and discuss ways to make India go cashless.

The 4 hour interaction was at ITC Windsor Manor. It was chaired by iSPIRT Mentor Mohandas Pai.  iSPIRT Governing Council members Bharat Goenka (Tally), Vishnu Dusad (Nucleus) and Sharad Sharma (BrandSigma) were also there along with Fellows Avinash Raghava, Nakul Saxena and Sudhir Singh. Shekhar Kirani who had planned the industry landscape showcase had to skip the meeting to be at his daughter’s music recital.

Showcasing behind the scenes transformation of India

The first session focused on bringing the software product industry landscape to life through a carefully curated showcase of 10 product startups. Each startup is a story of dreaming big about transforming India and the world. The goal of this session was to showcase India’s under appreciated prowess to shape industries and tackle deep rooted problems through its tech startups. The companies that participated in this carefully curated showcase were Ezetap, Instamojo, Capillary, PeelWorks, InMobi, Foradian, Team Indus, Forus Health, OlaCabs and Practo. The session went well and was an eye-opener to the policy makers. It helped them understand the breadth and depth of the emerging software product industry in India. One of them remarked that this was “one of the most awesome afternoons of his life”. They found the session to be “revealing and energizing”.  Everybody felt more optimistic about India’s future after this session.

Making India go Cashless

The next session was a thoughtful discussion on how to make India go cashless in 4 years. It was led by Bharat Goenka and Sanjay Jain (iSPIRT Open API Expert Team member, former Chief Product Officer of Aadhaar). They presented a comprehensive approach and suggested a new Program, Jan Samridhi, for the Government. This builds on the Open API work that iSPIRT has already done (in eSign, UPI and GTSN) and proposes specific and inter-related policy and regulatory changes. This benefits of going cashless are many. It’ll curb black money but will also expands micro-credit to small businesses in a big way.

Tax Friction for Product Startups

The final session was about tax friction for software product companies. Most of these are arise from poor definition of software products within the Finance Ministry. Mr. Mehrishi promised a quick resolution of these issues.

Conclusion

It was a very collaborative and interactive session. It showcased how India has emerged as the 2nd largest software product startup ecosystem in the world. It also brought attention to this new paradigm of creating Public Goods with a Social Commons model (open source model) and how this approach would be instrumental in India going cashless in a short period of time. Mr. Mehrishi and team suggested that deeper institutional mechanisms are required to bridge the intellectual distance between Delhi and Bangalore.

These powerful dialogs that iSPIRT is fostering with key policy makers (e.g. SEBI’s UK Sinha, RBIs Raghuram Rajan) are making a difference. They are helping us rewrite the script of the nation. And they are taking us closer to making India a Product Nation! So go ahead, spread the word.

Software Patents: Evil, Necessary or an Evil Necessity? iSPIRT OEQ Hangout

iSPIRT organized a OEQ(Open Ecosystem Hangout) on 20th April, 2015, to understand the role of software patents within the software ecosystem.Software patents are a much debated subject in the technology world today. In some jurisdictions like India, software is not part of patentable subject matter, while in other jurisdictions like the US, software patents are rampant. Do Indian startups need software patents? In a globalizing world, what strategies can they adapt to navigate through the software patents conundrum?

I moderated the session and asked the software entrepreneurs in the discussion to share their cost-benefit analysis of software patents.

Rushabh Mehta of ERPnext responded by saying that as a young startup, they find the cost of software patenting (estimated at around $ 15,000-$20,000 or between Rs 9.3 lakh to Rs 12.4 lakh) to be too high.

Srivibhavan Balaram of Vocera Communications, an entrepreneur, who has worked with open source and closed source software companies, said that patenting makes sense only if there is something unique that is worth patenting. However, he also added that the market for enterprise software was tilting more to open source now because companies were more inclined to go with time tested open source software, which find much faster acceptance. He added that companies are wary of proprietary software from startups.

Subramaniam Vutha, a veteran IP Lawyer and founder of the Technology Law Forum, said that India should actively encourage open source software, while accumulating as many patents as possible in jurisdictions that allowed it. He called this strategy, “Running with the hares and hunting with the hounds.”

Samuel Mani, Partner at Mani Chengappa & Mathur, said that defensibility is the only reason to file software patents. In a study that his organization did, he found that most areas that could be patented were already staked out. He pointed out that the cost of patenting is between $15,000-$20,000 which is the cost of hiring one employee for two years. He suggested that companies that aim to create a defense against software patents could join a defensive patent pool like the Open Invention Network (OIN).

Mishi Choudhary of the Software Freedom Law Center agreed with Mani on defensive patent pools like OIN. She added that most Free and Open Source Software are copyright licenses, but some also contain patent grants. She suggested that participants review the Debian Patent Policy.

This was the first such Hangout on software patents from iSPIRT, and there are plans to organize more such Hangouts to generate greater understanding of this topic.

Founders should do Content – iSPIRT content marketing roundtable

It has been one of the wettest April for Delhi in years. 5th April 2015 was no different. An overnight downpour had created a surreal Saturday setting for “Content marketing your way to multi-million dollars in revenue” at the 46th iSPIRT Playbook Roundtable. It was the 7th Roundtable in Delhi. The venue – the playful Wingify office at Pitampura in New Delhi.

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View from the Wingify Office

Participants came from far and wide – Gurgaon, Delhi, Noida, Greater Noida, Mumbai, Bangalore – braving the rain, the puddle and the traffic.

The stage was set at the Wingify cafeteria. Interestingly, all the participating product companies were actually seated in a roundtable. A few table tennis bats uncharacteristically placed in the corner indicated that a TT table had made way for the roundtable.

Love all. Play !!!

Paras Chopra – CEO Wingify – opened the roundtable sharing that Wingify was now working with 4000 companies across the World helping marketing guys do technical experiments without writing code. He shared the iSPIRT vision of making India the place for software products.

After calling for a quick round of introductions, Paras initiated the roundtable sesion with the question, “What is content?”

Siddharth, Paras’ teammate and the marketer at Wingify also teamed in to lead the session.

What is content?

Even if you do not read the rest of the post, the following lines should be good enough.

Before inviting the forum to give their definition of “Content”, Paras set the tone for the roundtable.

He said, “Founders should do content”.

“I love writing. I have been writing since 14.”

“A founder is well placed to articulate insights. And it matters.”

Paras emphasised that content should not be one-off. Content – he says – should have rhythm. A collection of outdoor hoardings create better impact than just one isolated bilboard. He mentions the work of intercom.io to illustrate his example, before opening up the discussion to the forum.

The forum was quick to put out a list – emails, landing pages, shareable content (viral), blogs, smart forms, CTA’s, e-books (gated and non-gated) and videos – at which the discussion came to an interim halt, thanks to Vidooly.

Vidooly – part of the TLABS batch – helps YouTube channel owners grow their organic reach and traffic using analytics. Subrat (CEO – Vidooly) mentioned about an impending VC round, but denied YouTube wanted to acquire them. He was quick to point out that DailyMotion was around.

On using videos for content, Paras pointed out the trade-off between a high quality video and the effort. Sub-par videos could compromise the brand.

On the other hand, the forum communicated its excitement about videos rattling out names like goanimate and powtoon that allow for creating quality videos, quickly. Ankit (MyPoolin) shared that they have attracted quality audience with videos, especially in the B2C context. Vijay (ZapStitch) seemed to agree. Subrat was agile to point out corresponding vidooly features e.g. meta optimization features that will help grow organic audience.

Is your business using Videos for content marketing?

Content ROI

Siddharth led this leg of the roundtable on Content ROI.

As the key marketer at Wingify, ROI is his daily job and he did not lose time to mention mixpanel to measure metrics, simultaneously dishing out the following:

  • TOFU
  • MOFU
  • BOFU

Though lunch was an hour way, there was now some food for thought.

IMG_20150404_112059

Siddharth was describing the marketing funnel. Wingify was using marketing automation tools like Infer, HubSpot and Fliptop to measure how prospects move from TOFU ( top of funnel) to BOFU (bottom of funnel). It helps gauge how business is doing with respect to marketing and business goals. Siddharth built confidence by indicating that users appreciate the funnel and demonstrate desired behaviours.

Did you figure out MOFU?

Sudhakar (RippleHire), who was patiently listening to all this gyaan (knowledge) invoked his consultant avatar and pressed with a terse question, “What to post?”

The question resonated.

What to post? – A quick look at Buyer Personas

Paras and Siddharth teamed up to take this question.

Paras said, “The problem with us entrepreneurs is that we think that all are like us. When it comes to our audience, implicit segmentation is mostly not accurate. At Wingify, we have been scientifically studying our users and customers for the last six months – Who are they? What do they do daily? It all comes down to buyer personas. Your content has to resonate with them.”

“At Wingify, we have created posters (at times whimsical) to communicate to our team about Buyer Personas”.

Siddharth closed this question emphasizing how they did persona surveys, got on support calls, identified problems users were facing, studied linkedin profiles and established KPI’s to scientifically determine what content to post.

Outsource Vs Inhouse

Needless to mention, all were ears on this discussion point. Would this be black and white? Or would it be gray? Siddharth made it clear that each team member at Wingify had to write. Period. It was even integral to their recruitment process. (More on that later)

Ashish from Posist was very forthcoming about their outsourcing attempts. He even admitted that even though outsourced content was good, ironically it wasn’t exciting. It required Vaibhav’s (RankWatch) quote of “1$ per word” comment for a well-known content writer to bring back the fun in the discussion.

Have you experimented with outsourcing content?

Siddharth stressed on the importance of quality compared to quantity. He went on to share that at Wingify, they make a lot of effort to produce one quality post everyday. It is always quality that is priority.

Getting content noticed

If you thought doing content was hard, let us talk about distributing and promoting it. It is hard too.

Guest Posting

We began with guest posting and co-marketing. Siddharth began counting his fingers.

  1. Email influencers rather than commenting on their blog.
  2. Short and longer posts are both OK, but some publishers discourage longer posts.
  3. Important to communicate to publisher how your post is relevant to their audience.
  4. Always stick to guidelines for guest posts.
  5. It is effective to send a TOC first to publishers, instead of a final draft.
  6. Seek out high DA sites with relevant keywords.
  7. When sending in the final post to the publisher, always include 5 to 6 links within the post to increase odds of drawing traffic.

Being opinionated

Paras strongly recommended putting out opinionated pieces of content. Siddharth testified that for Wingify, opinionated blogs drew comments in numbers compared to simple blogs that would not get any. At this juncture, the forum could not help but discuss the Freshdesk Vs Zendesk episode.

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The discussion was quick to move to click baiting. Surprisingly, most of us present in the room, admitted falling for it.

Have you?

Siddharth added that Wingify has consciously played trends to attract traffic. It had also done fun stuff like the A/B testing for the Savita Bhabhi website. (please search for the link on your own)

Organization Structure

This track saw everyone pick up their writing pads. While Paras spoke, a few founders were looking only at Siddharth. It seemed they had found the persona for their new content team member – Mumbaikar Dilliwala who gestures to emphasize his point; slighly overbuilt with a Che Guevara moustache.

Paras began by sharing how in the early days of Wingify he used to look at each content piece with a hawk eye. Over a period of time, Wingify has divided its marketing team into two – product marketing and demand generation. And it is looking good. Wingify has also hired a business analyst for content strategy where they are doing really detailed analysis like “what is the worth of a tweet?”. Wingify also has a marketing engineer as part of the marketing team.

How does Wingify hire?

Siddharth sounded sanguine about journalists with 1 – 2 years of experience saying that by that time the editors have chiseled them to write well within constraints. Siddharth adds, “Communicating clearly is fundamental to our hiring process. As part of the recruitment process, candidates are asked to write on a real topic”. Most candidates disappear at this stage.

Growth Hacks

Time was up. It was already quarter past 4 PM. Everyone was given a minute each to share their growth hacks.

  • Vaibhav (Rankwatch) did facebooks ads comparing themselves to competition targeted only to the fans of the competition. They also sent tweets to conference speakers with some topic suggestions and inputs.
  • Ashish (Posist) shared how they gave the impression of a local company to Bangalore restaurant owners by using native language on the visiting cards of their sales team.
  • Shashwat (iflylabs) used the plugin directory list to gain traction.
  • Saurabh (Airwoot) tagged brands in its tweets telling them how poorly they were doing and with respect to competition.
  • Kanika (SquadRun) shared how text emails helped them hit inbox rather than the promotions tab.
  • Vijay (ZapStitch) made a list of top 100 saas companies on its website and promoted it.
  • Anand (Exclusife) ran a missed call for free recharges campaign.
  • Sudarsan (Ripplehire) sent cold emails to the intended contact’s colleague to get a response.
  • Vikram (RateGain) shared how they use ebooks around tent-pole travel events to generate interest.

With that it was a wrap.

The customary iSPIRT roundtable photo followed at the Wingify reception.

content marketing iSPIRT roundtable

Thank you Wingify for your initiative and enthusiasm.

I would also like to highlight the participation from Avinash Agrawal (Eko Financials), Mohit Bhakuni (Contify), Mrigank Tripathi (Qustn) and couple of more participants. I apologize I did not record your inputs in the proper context. Could I request you to add your comments to this post?

Why are Indian startups so SaaSy? I took a bus ride with 40 entrepreneurs to find out

Reblogged from TechinAsia with the permission of the Author – Malavika Velayanikal

Saas-startups-on-a-bus

I stumbled at pricing initially. I sold my product at an 80 percent discount to a customer who kept pressing for more. After that the customer took me for granted, demanding more and more and more. Instead I should have tried to make him understand the value in the product. If he didn’t get it, I should have just moved on.”

“I learned from that mistake.”

“All of us entrepreneurs hero-worship ideas. An idea is like the superhero of a superhero movie. But what we don’t see clear enough is that for the movie to be a hit, you need a great villain first. If the villain is weak, your hero is also weak. So first thing to do is to figure out your villain. That huge problem which needs solving. I had to go through four iterations to figure out the right problem to solve with my product.”

“I hired an experienced vice president for sales very early on. That was a big mistake.”

“Why?”

“Because, until you figure out your sales learning curve, it is you the founder who should go and sell. Only you know the product enough, you know the architecture, so you can take the call easily. A sales head cannot make the commitments that you can, at that point. He should come in only when it is time to scale.

These were entrepreneurs talking. There were 40 of them, all running SaaS (software-as-a-service) startups in various stages of the evolutionary ladder. Some just out of college, some pushing the pedal at an accelerator, some experienced enough to invest in other startups themselves. They were all on a bus. From Bangalore to Chennai. To attend a first-of-its-kind meetup organized by a bunch of SaaS entrepreneurs for all SaaS entrepreneurs in India,SaaSx Chennai.

That I, a journalist, was embedded on the world’s “SaaSiest bus” – as they called it – didn’t stop any of them from talking about their biggest mistakes or what they learned the rough way.

And that was because SaaS was no longer an untamed, strange animal. Each of the entrepreneurs on the bus knew that they were sitting on a good steed. Everybody had a steady tick on revenue. “People call the SaaS business the flywheel business – it takes time for it to build momentum, but when it does, it is very difficult to stop it. This is what is happening now,” Sharad Sharma, co-founder of startup thinktank iSPIRT – the Indian Software Product Industry Roundtable, who is also on the bus, tells me.

Sharma is the co-founder and CEO of analytics startup BrandSigma. He is also a prolific angel investor with about two dozen investments. Former CEO of Yahoo India’s research and development wing, Sharma has been in the Indian tech industry since 1986, growing companies, building new ones, and now hand-holding young startups.

According to him, today, there are fundamental forces favoring SaaS startups in India.

The Uber for software

SaaS startups in India 1

SaaS is often called “on-demand software” because it refers to a subscription-based delivery model, where applications are accessed via the internet. The subscribers do not have the burden of installing, managing, and maintaining hardware or software; they just need a reliable internet connection. The company selling the software will host and maintain the servers, databases, and code that constitute an application. The buyers pay an annual or monthly subscription fee. That’s all.

It’s a clear win for companies do not want to invest in expensive hardware to host the software. They can spread out costs over time. And for the sellers, it means predictable recurring revenue, good margins, and inbound marketing.

The SaaS movement first picked up pace when Salesforce in San Francisco threw open customer relationship management software for small- and medium-sized companies on a subscription model. This was in 1999. It went public on the New York Stock Exchange in 2004, raising US$110 million, and acquired dozens of other startups later on.

Meanwhile, Indian startups too had caught on early. Chennai-based Zoho, founded in 1996, launched its first business app on the cloud – Zoho Writer – in 2005. Since then, the bootstrapped company has created a string of applications for businesses around the world, and grew to a subscribers’ base of over 13 million. Its success inspired many Indian startups to adopt the SaaS model.

A good example is customer-support software maker Freshdesk, now one of India’s hottest startups. Founder of Freshdesk Girish Mathrubootham was vice-president for product management at Zoho before he started Freshdesk in 2010. Today, it’s on par with global leaders like Zendesk. Leading software review platform G2 Crowd actually rated it a notch above its American counterpart.

Aces up the sleeve for Indian SaaS startups

Three key factors came together to give Indian startups an edge in SaaS, Sharma says.

First is the new pipe of buyers that everybody is selling to: the small and medium businesses of the West. The market is evolved there, and people don’t want to buy anything from a sales person. Why? “Because of the same reason they don’t want to buy cars from a car salesperson. Nobody buys a car from a car salesperson anymore because the next morning, they have buyer’s remorse. They feel they bought a car that they didn’t want, they bought features they didn’t want, and that they were oversold. And now, this is actually the problem in enterprise software. In every big enterprise, you will hear a term called enterprise shelfware – stocks of software, they are not using at all,” Sharma says.

So now, companies want to do their own homework to come up with software options and talk to sales folk on the phone, where they will be less likely to be cajoled into buying what they don’t want. And in that case, it doesn’t matter where the software-maker is based, in California or Coimbatore. The desk selling and marketing model of SaaS evened the playing field for everybody.

Second is the youth of the market. A few years back, selling on the cloud was just a mere concept. So everybody in this space now, big or small, are startups. There isn’t a Microsoft or an Oracle with a near monopoly in any of the SaaS verticals. For instance, Freshdesk is competing with Zendesk, but Zendesk too is still a startup.

“There is no incumbency – nobody has yet cracked the market fully. The market is still open for new players. That changes the odds completely. That is enormously enabling,” Sharma points out, adding that for the first time, Indian companies are not late to the global market.

The third star that aligned to make the magic work for Indian startups is the inbound marketing model for SaaS. Traditionally, a company needed a creative person, who will make an emotional ad that will resonate with everyone. But for SaaS startups, marketing is more about tweaking the product with numbers in mind – so it appeals to an engineer.

“Today, if you just talk to the people here in the bus, they will tell you that all marketers are also engineers now. They are the same type of people. The new wave of marketing is the scientific marketing; it is not the big idea, it is about making course corrections everyday. So it is very easy for Indian founders to adopt,” Sharma says.

Put these three together, and voila! There is an outpouring of SaaS activity in India, although it’s still an undercovered story in both global media and the local mainstream press.

Why the SaaSiest bus from Bangalore to Chennai?

Bangalore is always the first city to pop up in any conversation about startups in India. But when it comes to SaaS, Chennai has a star line-up – from Zoho to Freshdesk, Indix,ChargeBee, OrangeScape, Unmetric, and so on.

So Bangalore-based iSPIRT decided to hold SaaSx in Chennai and bus a few dozen SaaS founders there from Bangalore. Microsoft Ventures, also based in Bangalore, came in as a co-host.

About 120 SaaS entrepreneurs gathered in a conference hall at a swanky hotel in Chennai eager for some peer learning, expert guidance, and bonhomie. Serial entrepreneur Avlesh Singh, co-founder of customer engagement tool WebEngage was among those who shared his “SaaS story” of how he struck upon the core idea, found the product market fit, got the first 100 customers, and pushed the pedal from there to win almost every leading ecommerce company in the world as a client.

Freshdesk’s Girish Mathrubootham posed questions to the crowd, drew out tips to tackle common hurdles, and answered a few cheeky ones like how his company “poached” a client from its bete noire Zendesk.

The hosts launched a how-to-sell manual, “Jump Start Guide for Desk Marketing and Selling for SaaS,” based on the insights gleaned over the roundtable meetups iSPIRT had been organizing over the past year. The guide was co-written by Krish Subramaniam, founder of Chargebee, Niraj Ranjan Rout, founder of GrexIt, Sahil Parikh, founder of Brightpod, and Suresh Sambandam, founder of OrangeScape.

The inevitable future of enterprise software

SaaSx Chennai

According to Sequoia Capital, SaaS is the inevitable future of enterprise software. Microsoft agrees. The company’s new CEO Satya Nadella is embracing the concept, saying, “we are also in SaaS.”

In India, the SaaS trend has just picked up pace, but already some argue that it is as big as the IT services trend of the early 1990s. The outsourcing market was just opening then, and though there were biggies like Accenture, IBM, and HP in it already, Indian companies like Infosys disrupted their business model. Now, the SaaS startups in the country are taking to the desk selling and marketing model with great gusto, disrupting this space.

Currently, India’s main competitors are Australia and New Zealand among emerging SaaS hubs.

Sharma points out a way to evaluate this space, where companies have started to go public already. For example, customer support startup Zendesk went public last year. Out of the six competitors that Zendesk listed in their public IPO document, four are Indian companies: Kayako Helpdesk Pvt. Ltd., Freshdesk, Inc., SupportBee, Inc., and Tenmiles Technologies Pvt. Ltd (Happy Fox).

Now, there are about 34 SaaS startups in the US touted as IPO material in the coming four years. “Each one of them has Indian companies as their significant competitors, nibbling at their meals, trying to disrupt them. Now think of it. If that doesn’t tell you that India is arriving on the SaaS market, then nothing will,” Sharma says.

Looking around me at a busload of SaaSy entrepreneurs, I’m convinced.

Editing by Josh Horwitz and Terence Lee, second image by Stock Monkeys

Understanding Software Sales from the Tally Experience

It is safe to say that Tally is the grand daddy of all Indian Software Products, the only company to have discovered the holy grail of selling software to Indian small businesses at scale. So when one of the key architects of the Tally sales network, Deepak Prakash (Tally employee #3) came down to Mumbai to do a iSPIRT Roundtable, there was little chance I would miss this. And Deepak Prakash did not disappoint. In typical Delhi banter, Deepak walked us inside the mind of a top performing sales executive and how the goals of an entrepreneur and sales person, while contradicting from the outside can be wonderfully complementary if managed right.

2015-03-14 14.29.14 HDRIn the era of online marketing and social media, old world sales seems like a relic of a bygone era. But not in India. In a country full of contradictions, traditional sales still has its charm and companies that want to sell in India, must understand the nuances.

Empathy

The most recurring theme Deepak’s talk was Empathy. The ability to listen and ask good questions. This applies to both, the relationship between the customer and the sales person and the sales person and the entrepreneur.

Deepak talked about the importance of knowing the sales person and making sure their aspirations are aligned with the company’s aspirations. If the aspiration of the sales person is to buy a car or buy a house, then the person must be able to see that this job will be able to fulfil these aspirations. Aspirations of changing the world have to be translated to the sales person.

Being in sales is a crushing job. Most of us a wary of sales people and feel they are intruders. Hence it is very important for someone who is managing a sales team to constantly boost the ego of the sales person, It helps to keep up the “shabash” and back slapping. If the sales have not been good, its not a good idea to bring it up the first thing in the morning. Mornings should be positive. Its best to have an evening call and close the day’s issues.

Productising Sales

Once the sales process is stable and repeatable, it is important to standardize it. Deepak calls it productising the sales. Getting the words right is very important. It is necessary to always talk in the language of the customer. While calling the customer to renew, saying that “their account is going to ‘expire’” can send wrong signals. Avoiding use of jargon, having a clear pitch and script was at the heart of the sales process. A good sales person is always well prepared should never be in doubt of what to say in any given situation.

Strategy

One of the key learnings for most of the fellow startups was market segmentation. Deepak shared to attack  a new market. For example if you  were targeting automobile dealers,you  would first have have your own sales people break into 10% of the market and once the network effects started, i.e., you will  have enough references and word of mouth going, then you  start handing it over to a reseller or partner network.

In Deepak’s words “you should  eat the elephant, but piece by piece”

Channel Building

A point will come when it will be  impossible to keep growing the sales network. Not only will it be  expensive, it will  also difficult to manage large sales teams. Hence it imperative for you  to start building a partner network. On being asked, when was the best time to start a partner network, Deepak answered, when there was a repeatable (productised) sales process.

International Expansion

There were many other topics Deepak touched upon like hiring (good sales people are great listeners), Tally’s approach to piracy (don’t inconvenience the customer), managing targets, bringing in influencers (charted accountants in case of Tally) and being clear of what you want (Tally was clear they did not want to go for enterprise customers).

Some of Deepak’s stories reminded me of the Jagdeep Sahni scripted “Rocket Singh, Salesman of the year”, which I think is a brilliant, highly underrated Indian movie for startups.

The Key to selling software to SMEs in India

One of the things Deepak wanted to share with the startups, something that Bharat Goenka, the founder of Tally has also spoken elsewhere, is that the buying patterns of small businesses in India are like enterprises in mature markets. They are used to being sold things rather than they pro actively going and buying stuff. Deepak wants to warn software companies (and their VCs) that they need to plan for scale (more than 10,000 customers). This is not a market for half measures.

My Take

While the session was delightful and insightful, I don’t think startups should try and emulate what worked for Tally. Tally was a product of an era where there was no internet and software adoption was in its infancy. They succeeded because they had the right strategy, risk apatite and execution for the market they wanted to succeed. Also once they hit critical mass, the role of the sales person was only to ensure availability, because the customer already knew they they wanted Tally.

11063806_10152785041892794_1847266351215314437_nThere is a reason the roles of travel agents or insurance agents is shrinking every day. The internet is a wonderful for discovery, learning and distribution of software and startups should go on this path. While sales may be necessary for enterprise, it is too expensive small businesses.

We understand that today, the Indian small business may not be ready to buy without being sold to, but this is changing fast. We are happy to wait and perfect the online game, so that when the markets open up, we have to most compelling offering ready.

Launching iSPIRT pre-entrepreneur Program

The clichéd but very apt picture provides the context for this program.

Pre-Entre-programThe media shrill is at peak right now about entrepreneurship and many are jumping headlong into it armed with in depth technology, product management and sales skills. While there is considerable information available on the tangible skills, one of the key skills is self-management and ability to deal with incredible amount of uncertainty, indecisiveness, FOMO, self doubt and various other critical but often ignored aspects. Most are also not exposed to this intensity in their normal corporate existence.

Few folks in iSPIRT have been dwelling on this and with a happy coincidence of many events have come up with a program to address this need. We’re piloting an iSPIRT pre-entrepreneurial program to sketch a path for builders/makers who want to startup, including resources, exercises, and activities that strengthens them for their entrepreneurial marathon. Bringing in the principles of effectuation, developed through observing 45 expert entrepreneurs who have at least 15 years of entrepreneurship. Effectuation puts the entrepreneur as the agent of change, owner of their destiny, and helps them create the future rather than predict it.

The program itself will be a journey through market and personal challenges that a founder must go through when they do a startup. Those going through this program will get tips from experienced entrepreneurs in the Indian ecosystem, frameworks to develop their own products/startups, and a support system through the entrepreneurial journey.

The program will include effectual entrepreneurship and skill-building. This will be a 10 weekend workshop, with 90 minutes per week. The workshop is tentatively scheduled for mid April.

If you know someone who

  1. wants to startup soon
  2. wants to learn the challenges and difficulties of doing a startup
  3. wants a peer group that can help them through the journey
  4. is open to learning about and changing themselves
  5. And wants to co-create this program with iSPIRT,

Please nominate yourselves (or them) here

 

InTech50 – helping software product companies connect with influential CIOs from across the world

In a recent article in ET, Mohandas Pai and I suggested that if India does not produce enough product companies, our economy will not be sustainable in the future. The data is compelling. To quote from that article, “Boeing and Airbus alone generate almost as much profit as all global airlines put together. Pfizer’s profits are more than those of the top 100 hospitals in the US. Cisco’s profits are more than those of all European mobile operators. Microsoft generates more profit than those of top 20 pureplay global IT services firms.While Indigo is a very well run airline, being a Boeing creates far larger value.”

Indian entrepreneurs and businesses can be world-scale and world-class. We have demonstrated that convincingly in services. Airtel, Jet, Indigo, Apollo Hospitals, Fortis Healthcare, TCS & Infosys, etc. are fine examples of companies that are respected across the globe. There is no reason why we cannot create world-scale and world-class product companies in India. The environment is conducive for entrepreneurs to now think ‘products.’

We created iSPIRT as a non-profit think tank with the aim of accelerating the software product eco-system in India. Since our inception in 2013, iSPIRT has focused on solving tough problems that will foster software product companies in India. Making M&A happen is one such problem. iSPIRT’s M&A Connect Program has made a big difference there. The last one-year has changed that perception of India as just a software services destination, and we have now generated early but enthusiastic interest in the international markets for our software products.

Some of that change in outlook started becoming apparent when, in January 2014, Facebook acquired Little Eye Labs, a Bangalore based startup that develops performance analysis and monitoring tools for mobile app. This was followed by Yahoo’s acquisition of Bookpad, whose document-viewing product is similar to Google Docs. The latest in the series of acquisitions is that of ZipDial (a mobile and analytics company) by Twitter. Some of these acquisitions, which got significant media attention in the startup eco-system, will hopefully encourage more entrepreneurs to think products.

Another hard problem

Another problem, which is equally hard, is to do with getting quality access to big-name CIOs in US. InTech50 address this issue. It is a one-of-a-kind forum where shortlisted software product companies get an opportunity to showcase and interact with some of the most influential CIOs from India and other parts of the world. This unique platform is a springboard that provides software product companies a connect with potential customers, investors, partners and influencers – that they would otherwise find it difficult to access, and certainly impossible to access over a 2-day period. InTech50 – a collaboration between iSPIRT and Terrene Global Leadership Network – serves as a platform for recognizing the most promising software products by entrepreneurs in India. After a thorough screening of applications, 50 innovative technology startups from the software product space are shortlisted to interact face-to-face with a panel of renowned CIOs and investors from across the globe. Through their close interaction with them, these startups gain valuable insights, which can facilitate them in scaling up globally.

The event, scheduled for April 15-16th 2015, is our 2nd edition. In our inaugural InTech50 event last year, we curated some high-potential companies. The audience of CIOs and other stakeholders took note. They now recognize that India is on the cusp of becoming a product nation.

InTech50 is the only forum of its kind where startups can get unparalled access to top global CIOs and investors, closely interact with them and showcase their products extensively with the end goal of closing deals. The best part is that CIOs from across the globe will assemble right here in India with the sole objective of finding interesting software product companies that they can engage with.

Though the applications for InTech50 are closed, if you are convinced about your product and feel that it deserves every chance to be showcased at the event, you have ONE LAST CHANCE TO APPLY by getting one of the Fellows, Founder or Product Circle Donor at iSPIRT to recommend you. (You can view the list of iSPIRT Fellows).

13897639212_c86c8c02ed_cIf you are shortlisted, do work with Mentor Panels and Business Catalysts, to prepare your pitch, and interact with our team and past participants to understand how to best leverage this unique opportunity. Take a look at our illustrious panel of Business Catalysts here.

NRK Raman, Co-Founder of iFlex (instrumental in its acquisition by Oracle for a whopping USD 909 million in 2005), is driving our effrots to help product companies sharpen their pitch and presentation.

With InTech50, you have everything you need to GO BIG, right here, on a platter – the right connections, the requisite support and everything else that you’ll need in the process.

Watch this space. India is on its way to becoming a Product Nation.

RBI Governor Dr. Raghuram Rajan meets Product Startups.

He is a maverick, a reformer, a decision maker and above all the Governor of Reserve Bank of India. The country’s foremost authority in Economics met with Product startups in Bangalore to understand their challenges and also provide useful advise by participating in interactive sessions for close to 3 hours.

2015-02-27 10.23.43
Yesterday, at ITC Windsor Manor, Dr Raghuram Rajan, honorable governor of RBI, along with Industry stalwarts Mohan Das Pai, Sudhir Sethi, MD of IDG Ventures, Shekar Kirani, Accel Partners, Sharad Sharma (iSPIRT), Bharat Goenka (Tally) and many other industry leaders heard the stories of about 10 Indian startups. The idea was to understand the following challenges of the startup Ecosystem

  1. Startups from India Competing with Global Giants with Capital Markets Challenges (like raising capital from Domestic FIIs, listing for IPOs, and other book building challenges)
  2. Startups from India building Software and Technology Products and solving local and domestic problems with the new & developing landscape of Consumer Market Challenges (like changing landscape of payments, pre-payments, recurring payments, etc)
  3. Product Companies like Tally and others from India, empowering small and medium businesses in INDIA to become Digital SMEs for leap-frogging the Indian Economy.

Dr. Rajan, was very forthcoming with his following admissions and suggestions.

  • Some of some of the difficulties in moving money in and Out of the Country (FEMA regulations for example), requires a more coherent set of rules, regulations and systems.
  • He also suggested that all Institutions, need to keep pace with the technological advances, and the need was really to have an Inclusive approach to carry everyone forward.
  • He assured full commitment to the Payments Systems Revolution, highlighting that
    • Payment Banks and Small Banks will be in full steam in about 12-18 months
    • Innovative ideas of White-labeling of BCs (Business Correspondents) via Individuals, Corporations or Registered Companies was actively being discussed.
  • His willingness to open up a dialog with Innovative Companies, where Banks are a purchaser of Technology was also evident in his offer to have more follow-on meeting.

Close to 180 minutes of conversation and showcasing of New Product Startups and Business Houses like Tally from Bangalore. Around 8 companies got the opportunity to showcase and highlight their challenges and directly interface with the Dr Rajan himself. Not all elements of the session can be reproduced here, but below are some of the key highlights and learnings.

2015-02-27 10.24.32Home grown Startups share their Stories with RBI

About 10 Indian Startups which started in INDIA, and which have global operations today, presented their stories not just from a valuation and growth standpoint, but from an emotional and proud-to-be an Indian startup viewpoint. To sum it up, almost every story was about Entrepreneur’s who dared to dream something not only for them, but for INDIA, and today want the Indian Systems (Regulators, Government and Institutions) to reciprocate to their needs. They highlighted their list of issues, the below checklist includes, but is not limited, to the following.

  • InMobi’s Naveen Tiwari, believed that INDIA can be the HUB for solving Global problems and with 39 other startups which have spun-off from INMOBI, it was clear that there is a 10x growth that is possible in the Indian startup eco-system.
  • Uniken a Security startup company with solutions for the Hyper-connected world, spoke about how their solutions have been deployed by Global and Indian Banks, including Bynet Communications. They stressed the need for all Indian Banks to adopt the latest solutions from India Solution Providers themselves which are on par or better than many cutting-edge solutions from outside of INDIA.
  • Fintellix highlighted their Software for GRC Intelligence (Governance, Regulation and Compliance), which are today used by both Indian and Global Private Banks, but they cannot get through even the RFP process of many Public Sector Banks, due to archiac processes.
  • Freshdesk presented a crowd sourced Customer Support Platform for Businesses, Tally Spoke about large scale adoption of their Accounting Software by SMEs (in millions), FORUS presented their home-grown medical devices (3nethra) which could be adopted by Indian Hospitals for 1/3 the cost, and how 80% of issues leading to Blindness can be prevented, while SnapBizz showed how even Kirana Store business owners today could gain improved visibility using the SnapBizz cloud platform.
  • Team INDUS and Deck.in showed, how Indian startups are turning world-beaters with their big ambitions in Aerospace and Enterpsie Software solutions.
  • Bharat Goenka and Pramod highlighted the need for Separation of Concerns between Transaction Enablers (Banks) and Technology Providers. Goenka stressed that Velocity of Growth, is dependent directly on the velocity of transactions.

Insights and Learnings from RBI and Dr. Rajan.

There were many learnings for all participating Startup & Business Entrepreneurs. Some of the key ones are

  • Dr. Rajan believes that for Capital availability & Funding Process for Innovators there needs to be a different RISK Framework that needs to adopted. The existing RISK framework was meant to keep the bad-elements away from the System. The new RISK framework should look at being a support system for Good Innovators.
  • Dr. Rajan also was open to look at enabling PUT-OPTIONs which will provide down-side risk protection for atleast the Investment-value like in WESTERN Contracts.
  • Dr. Rajan however, said we must all be cautious of Back-door debt masquerading as Equity and causing Systemic Harm.
  • Dr Rajan, participated enthusiastically on the following topics
    • Payment Banks / Small Banks and their utility for the Indian Business growth
    • NPCI framework and Payment Systems Revolution
    • Working with FEMA (Mr. Padmanabhan) to resolve difficulties in Money Movements.
  • Other most important advise for Startups were also discussed. To note a few,
    • RBI Governor said India has a decent Capital Chest which provides some Immunity to the Global shocks, however we cannot act in Haste.
    • Today, the need for Inclusive growth were the Unsophisticated Audience can also be carried forward, should be an objective for all innovative solutions.
    • Indian Public Sector institutions should welcome tech-savvy and young entrepreneurs as part of some of their committees.
    • Most importantly RBI can play a convening role for adoption of Innovative Products by Indian Banks.

2015-02-27 10.24.03Conclusion

Overall it is apparent that the INDIAN technology/internet product markets, are in a Golden Moment where Aspirational issues are leading to better RISK appetite among INDIAN Entrepreneurs. It is a new Paradigm where not just startups, but all Institutionals bodies with-in INDIA, need to now collaborate and commit, for supporting each other’s RISKs and Needs. RBI on its part has definitely shown keen interest, and to quote from a fine statement made by Girish, Dr. Rajan, believes that RBI interventions may arrive late, but they will definitely be latest. The Entrepreneur hence must be patient and not act in HASTE.

The best things are simple. Is your messaging there yet? : from #PlaybookRT

The most crucial lessons come from looking at the mistakes: those that we make and those that we spot others making. A thought might get triggered by listening to great dreamers like Steve Jobs. But the termination, in terms of realization, implementation and imbibing the essence comes only when you have walked through that journey and declared a new start.

Shankar, who imagined and steered the 43rd round table in Delhi, created amazing examples to drive across the points, we had often read heard and hoped to understand. I will try and share what were my takeaways.

This session, thanks to Rajat Harlalka and the amazing iSPIRT movement, started off with an unforgettable lesson, on what is the Curse of Knowledge.

You need to attend one round table to experience it. For now I can only re-iterate one of the ways it is often represented.

The moment you know how to speak a language, you forget what it is like, to not know it.”

The same thing happens with you and your product. You know it too well to imagine what it looks like to those who don’t know it. What should the message be, so that the potential customers want to have it?

Who?

So if you are looking at spotting your messaging, spot the Who of your customer.

  1.       Who is your Bob (What Bob?)
  2.       What does he look like
  3.       Where does he go
  4.       What does he do

Why?

Once you have figured out the Who, move on to answer the Why

  1.       Why should Bob need your product
  2.       What’s in it for him
  3.       How does it make him better

Only after figuring these questions would it make sense to move on to ‘What’ your product does and ‘How’ does it do it.

I want you to read that again. Give it some time to sink it. Let it challenge what you think you know.

List of Videos by ShankarIt’s only after spotting “Who is your Bob” and “Why should he bother” that you product and it’s features and functionality come in.

First response of one of my fellow entrepreneur to this statement was: I know all that.

‘I am the best ecommerce setup for finding XYZ. That’s why he should care’, he went.  Really?

It’s like saying, “I am the best writer. You better read my books”. Does that work?

If you have both the answers, feel confident. You are amongst the top 5% companies who have their basics right.

Now what do you do with this knowledge?

Let your Bob know!

This was where I would say, the workshop’s original aim hovered.

If you have your answers, incorporate them in your messaging. Share a story that people can relate to. Share with your Bob that you are going to make him better. Let your messaging help Bob, feel this sentiment.

If you look at the steps we went through and reinforced during our Bob journey, there were just 2.  Make yourself :

  1.       Meaningful, and,
  2.       Differentiated, to your Bob.

One other takeaway that stuck with me was this: The best things are simple. Is your messaging there?

Guest Blog post by Kritika Prashant, VoiceTree Technologies

Here’s how India’s “Product Nation” ambition be achieved and what the Budget can do for that ambition

The Next Google, Made in India

If you look at the Indian business landscape, you will see several successful services companies in fields like airlines (e.g. Jet, Indigo), health care (e.g. Apollo, Manipal), mobile phone services (e.g. Idea, Airtel) and IT Services (e.g. TCS, Infosys). Many of these companies are comparable to global peers, if not potential world beaters. What we don’t have are the corresponding product companies. We don’t have an aircraft maker like Boeing, a pharma company like Pfizer, a network equipment company like Cisco, or a software product company like Microsoft.

Is this is a problem? Yes. Because Boeing and Airbus alone generate almost as much profit as all global airlines put together. Pfizer’s profits are more than the profits of top 100 hospitals in US. Cisco’s profits are more than those of all European mobile operators. Microsoft generates more profit that the profits of top 20 pure-play global IT Services firms. Take a moment to digest that and it becomes clear that if India remains bereft of product companies, it won’t be a sustainable economy in the future.

Backdrop-10by11(all-english-style)-v2

Building product companies is hard, to be sure. Despite the fanfare, Tata Motors’ Nano has failed. And, sadly, Bajaj has been humbled by Honda in the last two years. In high-tech, Ittiam, despite its success in developing core intellectual property in online video, hasn’t broken into the main league. And, with our borders open to global competition, is it too far fetched to imagine that in a few years Amazon would have pipped Flipkart and Uber, not Ola, would rule our roads? We may have Indian players serving our digital consumers, but most categories might be dominated by foreign companies. Google already owns our search, Skype owns voice messaging, Facebook owns social media.

Is India destined to lose all these battles? Maybe not! But if we have to win, we have to embrace a new gameplan. Products, especially software products, are a winner-take-all business. Either you win or you are a nobody. Its not a place for the faint hearted.

In fact, tentativeness translates into a loss. It leads to sub-critical investments. We are staring at a costly example of this in the nuclear reactor industry right now. India can build 700 MW reactors. But economies of scale now kick-in at 1600 MW. Since we didn’t invest enough in the last 20 years (despite a wonderful start that Homi Bhabha gave us in 1950s), we are not a player in this large-reactor segment. So we will spend more on buying these bigger reactors from France, Russia and US in the next three years than what we have spent on our entire nuclear industry in the past 50 years! This is a really expensive failure.

If this was a one-off case it would still be okay. It is unfortunately not. In telecom, despite CDOT, CDAC and Sam Pitroda, we have only created one Tejas Networks, a nifty networking start-up from Bangalore. But, guess what? Tejas gets a pidly 1% of the annual telecom capex buys in the country. Rest is imported. We have a big rail network but no rail equipment companies. We are a generic drugs superpower but limp when it comes to new drug discoveries. These failures to create product winners don’t even faze us. We pretend it doesn’t matter.

We don’t even introspect why this is the case. When one sets out to create the world’s best hospital, airline or IT Services company, one builds in layers over years. But building a world class product company needs a different mindset. You have go all-in and bet-the-company on market or technology shift that is underway. This mindset is new to us in India. Our success in building services companies comes in the way. We have to accept this Provenance Effect; it is subtle yet significant.

To be sure, we are not the only victims of this effect. Taiwan is a victim of this too. It isn’t a player in mobile phones, ironically, because its design services legacy holds it back. Venezuela is not able to crack the chocolate market. El Ray owns the high end cocoa market, a key raw ingredient in chocolate, but comes up a cropper in high chocolates. If you ask the Belgians or Swiss, they tell you that they are a chocolate nation because they don’t have the cocoa mindset. Lack of a services industry legacy helps not just Korea but also Estonia (created Skype) and Finland (land of Nokia and Angry Bird games). It turns out that mindset matters — big time!

We have to jettison two ideas that hold us back from becoming a Product Nation! The first one is rather simple. We have to accept that no matter how well-run Indigo Airlines is it’ll not become a Embraer or Boeing. Similarly, a Narayana Hrudayalaya hospital will never bring a drug to market like a Pfizer does. Airtel or Verizon will never build a router like Cisco or Juniper do. And TCS will never be a Microsoft. Acknowledging this plain reality is the first step that we must take.

Then, we must discard our mentality of unbridled greed and reluctance to make bets — best showcased in our penchant for large Olympics contingents. Nobody cares about how many athletes you send to a sports competition, they only care about the number of medals you won. To improve odds of winning, small focussed efforts produce better results than grandiose schemes. Today, we have four times more new startups than Israel for one-sixth the outcomes. One reason is that the ecosystem enablers are narrowly sector focussed in Israel. The accelerators that help medical device companies don’t work with cyber-security start-ups there. Can’t we have a sector-focussed approach in India aiming at solar energy or medical devices, to name just two promising areas to bet on? If someone needs proof of concept: look at our performance in badminton and wrestling in India in recent years. The enablers in these sports are game-specific. Anything that smells like a generic “startup” program will have a low impact. It quite likely to be a scam!

Software product entrepreneurs when they are successful make a big economic impact in this winner-take-all world. So they are being courted worldwide. US is trying to get the Startup Visas in place for them. Canada already has a working program. Singapore has startup tax exemption. UK is in the game too. In our last budget there was a tantalizing line about “a special focus on software product startups”. Nine months have passed and nothing material has happened yet. Maybe this new budget will bring some well thought-out policies to light. This year 75% of newly funded software product startups will redomicile themselves in Singapore or US (up from 54% last year).

It is time for India to wake up to our Product Nation imperative. It is an opportunity for the NDA government to write history again. In 1998, they introduced a 108 point policy for IT services and we have the benefits around us to see. Now, they must do the same for software products. For the first time in modern India’s history, we have a chance to create world-winning products from India. The decisions we take today to support our flight to become a Product Nation will decide whether tomorrow’s Google, Viagra,Facebook, or Uber come from our nation. Act now.

Jointly written by Mohandas Pai & Sharad Sharma for Economic Times. 

Roles and Responsibilities of Startup Founders.

Roles and Responsibilities of StartupThis is the 2nd in the 5 part series on ‘How to Sell in the US Market from India’. I had attended the Round Table organized by iSPIRT and here I attempt to capture the important points from the discussion. (You can read the first part here)

One of the topics of deep interest for the participant was on clearly understanding the role of the Startup Founders and where should their time and focus be optimally spent in order to achieve higher success.

As with the format of the Round Table, 15 startup founders shared their ideas which were wonderfully facilitated by Suresh Sambandam, CEO of OrangeScape. The founders spoke from their own experience as well as tapped into the practice of other successful founders. Here are the key learning from the discussion.

Be Prepared to Spend 16 Hour Workdays.

The Startup Founders are the ones who are the most passionate about their firm and they have everything riding on the success of the firm. It is they who believed in the fundamental business idea. One of the fundamental requirements is for the founders to set the right precedent by investing the bulk of their time on the business. This adds confidence and motivates the rest of the team members to work hard as well.

In the early days, it requires someone who knows the vision, the product as it stands today, the message that need to be communicated to the market, listen to customers to understand the buying process and also get the feedback from usage from existing customers via support. This means spending time with engineering/product, marketing, sales and support. This is where having more than one co-founders help a lot. But if you weren’t the blessed one then you have to pull it all yourself. Be prepared to spend 16 hour workdays across all these 4 functions.

Change your Work Timing

Remember that you are selling to the US Market and hence you need to adjust your working hours to match theirs. Your sales sales days typially starts like 6pm or 7pm India time and go on till 2am or 3am. This is a very crucial time that you need to spend. As a founder/co-founder you are essentially figuring out sales process. This is of paramount importance.

All Startup Founders Should be ‘Chief Sales Officers’

Sales is quite obvious. A business idea might be great but it amounts to nothing if the revenues don’t flow in. It’s very important for the founders to lead sales operations and spend a lot of time prospecting, pitching and listening to what customers are saying during the sales process. Having someone hired for this job during very early days doesn’t help at all, as it requires more connecting the dots w.r.t. to vision and product. Iteratively, the founders have to figure out the companies and the decision-makers profiles within the company. The more you are able to pin-point the decision-makers, the better are the chances of sales closures. This is called as ‘Ideal Customer Profile’.

Founders should do support a lot during early days!

While its a general trend for most startup founders to wear the Sales Head hat, most founders don’t pay enough importance to support. That’s usually relegated to a team member. Suresh Sambandam strongly reiterated that the founders do hands on support job just like a regular support person. This needs to be done with the attitude of NOT as a CEO, not as a founder, but just like a regular support person. This is important early on, to receive first hand feedback that is vital for the improvement of the product. Other startup founders who attended the session also felt that there is a strong correlation between support and sales. Better support results in happy customers which results in better up-sell and better reference leads. In fact, some of the founders felt that the support personnel must be paid on par with the sales staff in order to send a strong message that the company takes its support seriously. After the early days, while support team will grow on its own path, it is important for one of the co-founders to have direct ears to what is going on in support.

There is an excellent blogpost on Freshdesk that is worth reading.

Hire People Smarter than you

The first set of people can make a big difference to the success of a startup. The founder should directly be involved in identifying and interviewing the candidates. It’s critical for them not to let the ego get in the way. The best founders identify people who are way smarter than them. It’s also important for the founders to elucidate the vision of the company and narrate the company’s growth plans. By being highly involved in handpicking each and every employee, the founders can build a solid team with complementary skills needed for the success of the startup.

Nuts and Bolts of Selling to the US from India for First Timers : Part 1

The 42nd iSPIRT RoundTable (RT) focused on an enormously interesting subject of ‘Nuts and Bolts of Selling to the US from India for First Timers‘.  The session was meant for startups focusing on SaaS products (mostly in the B2B space) but the learning can be applied to any startup targeting the US market. This is the first in a 5 part series that captures the important learning from this Round Table.

Unique Format for Collaborative Learning

For a guy who is a big believer in the power of collaborative learning and knowledge sharing, I fell in love with the format. The Round Table lent itself well for more Q&A style discussions and sharing of experiences. There were 15 startup founders and this limited number was helpful in catering to specific company related discussion. s the session went, each of them spoke from their experience and shared best practices that worked well for them.

I also loved the fact that this was a day long event starting from 11am till 4pm (the after event discussion went on for another hour). This was useful for deeper discussion on important points.

The format also steered away from the traditional lecture mode. There was no speaker but a discussion facilitator. Suresh Sambandam, CEO of OrangeScape and founding supporter of iSpirit, was the facilitator.  Suresh has successfully bootstrapped his start-up to a multi-million dollar entity and so he was the perfect person to lead the session.

This particular round table catered to startups that are approximately averaging US$5000 and intending to grow it 10x to US$50,000.  This RT is second of a three level RTs that cater to different sized startups.

560226_10153123542027845_4156238184454810538_nTypes of Round Tables

RountTable Level 1: Caters to startups in the formation stage which helps them to home in on their right target audience and business plan.

Round Table Level 2: Caters to startups that aim to increase their revenues 10X to US$50,000 per month.

Round Table Level 3: This is for well established startups who are billing a MRR (Monthly Recurring revenue) of US$50,000 and want to grow 10x to US$500,000 and more.

B2B Customers Categorization

Suresh explained that it is very useful to identify which type of clients that we are gunning after. Having this clear segmentation helps as each of these categories have different needs and pain-points.

SOHO (Small Office Home Office) : 1 to 0 employees.

VSB (Very Small Business) : 10 to 50 employees

SMB (Small and Medium Business) : 50 to 500 employees

Mid Market: 500 to 5000 employee

Enterprise: 5000+ employees.

In the second part of this series, we’ll capture the learnings on the key roles and tasks that founding team members should undertaken to better the success of the startup.