ozonetel Archives - ProductNation

26/06/201515/03/2017

What is a good sales target for a sales person in SaaS in India?

Unfortunately there is no fixed answer. Problem with SaaS is that there are too many moving variables. LTV,Churn,ARR,ARPU etc. So its really hard to come up with one fixed number. So based on our experience and our product the following is a number we have come up with to set targets for our sales organization.

0.8x(x is the sales person’s salary)

So, a sales person should pull in 0.8x worth of MRR every month. Or 9.6x worth of annual contract values every month. This is the number from which they start getting incentives.So for example a sales rep getting around 18 lakhs salary should pull in around Rs.1,20,000 MRR every month. If he pulls in 30,000 MRR(0.2X) he will be just covering his base salary. If he pulls in 75,000(0.5X) he will be covering the organization costs. And only if he pulls in anything above that will the company move towards profitability. And only when the company is profitable will the sales get an incentive.

Obviously there are a lot of assumptions made to arrive at this number. We are assuming the LTV to be around a year and churn is also very low. You can find a spreadsheet with some numbers here. You can modify the variables to fit for your organization.Just open SaaS Sales Targets and play around with the values to see the numbers. You can also download it and modify it as you see fit.

Since we started a sales organization a couple of years ago we have been experimenting with different variables and this is a good rule of thumb to follow for setting sales targets. Please comment on what your experience has been. Is our model too tough on sales guys or too easy. Hopefully we can all come out with a comprehensive model for sales in SaaS in India.

04/06/201504/06/2015

A conference of the products, for the products and by the product leaders

Indian startup space is on a roll and while there is a lot of money being invested, we strongly believe that one needs a lot more talks on products – ranging from product management to marketing / growth hacking et al.

Product Nation has partnered with NextBigWhat for its upcoming conference, ProductGeeksConf. At ProductGeeksConf, you will hear various product leaders share insights/experiences building some of the great products from India.

Some of the speakers include:

Punit Soni (Flipkart CPO), Deepak Abott (Marketing Tech specialist) and several others (more speakers will be announced by this week).

Topics include:

Scaling up Product Management Function
How Social Media influences Product Management decisions
The emergence of the growth hacker and how this new role and how growth teams
Marketing tech hacks for app developers on budget.
The Nuances of Customer Acquisition : CAC,LTV,ARPU,MRR. WTF

As far as industry focus is concerned, the conference has something for everyone – be it consumer, enterprise or the app developers.

We are happy to announce that ProductNation community gets a special discount of 20% on the conference tickets (registration link / use the code PRODUCTNATION).

Date : June 19th
Venue: MLR Convention Center, Bangalore.
URL: http://www.nextbigwhat.com/unpluggd/productgeeksconf/

Note that the discount is valid only till June 8th.

21/11/201315/08/2014

Complementary skills in your founding team is critical for a startup’s success – CSN Murthy, Founder and CEO, Ozonetel

ProductNation interviewed CSN Murthy, Founder and CEO of Ozonetel, a leader in cloud telephony based solutions. In this freewheeling chat, Murthy, a serial entrepreneur, shares his mantras on building a successful technology based venture. Read on…

What was the motivation to start Ozonetel?

Around 2007, after the successful exit from Intoto, we examined various opportunities in the marketplace to start a new venture. Having worked in the telecommunications space over two decades, we recognized a huge unmet need in the Indian marketplace in the area of usage of telephony by businesses. Businesses were losing out on vital customer leads and important information due to their reliance on traditional telephony based system. We therefore setup Ozonetel during 2007-08 to solve the customers communication based challenges through cloud based telephony solutions.

Can you explain the rationale behind using cloud as a delivery mechanism of communication products/services to Indian customers?

Cloud based telephony solutions is a natural progression from the previous physical PBX solutions. On the technology front, cloud based solutions help overcome the existing limitations of telephony solutions such as missing an inbound enquiry from a prospective customer. It provides tools to track your efficiency in responding to customers. Businesses can scale quickly based on the volume of customers they deal with on a pay-as-you go basis. Thirdly, since the workforce of businesses has increasingly become mobile, a cloud based telephony solution enables a business to respond to customers without being bogged down by physical location based constraints. These and many more aspects provide unprecedented value to businesses to solve their communication challenges. So, we started offering these cloud based telephony solutions to the Indian market.

How did you get your initial set of customers? What learning did you obtain from dealing with them?

We targeted the segment of customers who were willing to experiment with our offering. The first version of our offering required significant technical expertise at the customer end to use and benefit from it. Luckily for us, our first sets of customers were mostly technology based startups who understood the value of our solution. Companies like ZipDial and Asklaila used the APIs that we provided and integrated them in the manner they preferred. Grameen Foundation, another early customer of ours took help from ThoughtWorks to integrate our solution with their other systems. We also learnt from our initial prospecting that cost was an important parameter for businesses in India.

How did the company evolve from the first offering to its current state, where it has diversified cloud product offerings?

After finding initial customer acceptance, we quickly realized that in order to scale our business and make it usable across different sectors, it was important to make our solution more consumable and usable by end customers. Towards this end, our first solution was to announce KooKoo – a telephony platform that allowed end customers to build their own applications either on voice, SMS or fax. We then further enhanced our portfolio with Bizphone – a virtual PBX solution on cloud which customers could use out of the box, with no set up costs and hardware investments. The Bizphone offering helped us cater to needs of diverse set of customers across different sectors. Based on our insight and customer feedback, we enhanced our product portfolio by introducing CloudAgent – our cloud based contact center solution for businesses that are slightly more sophisticated business communication requirements. The growth of business in India augured well for us and we now offer these solutions to businesses of all sizes and sectors.

How have you ensured that you have competitive advantage in the marketplace?

We had the first mover advantage when we started – which helped us to garner the initial set of customers. However, as the marketplace started seeing benefits of cloud based telecommunication solutions, new competitors emerged. Having been in this domain for a fairly long time, we had envisioned this scenario – and have developed key differentiating strategies right from our inception.

Back in 2007, when we started, we could easily have integrated a solution from different vendors and provide the same to businesses to satisfy their immediate needs. We instead chose to develop the entire solution stack – right from the hardware, telecom cards and software on our own. Though this took us about 18 months, this approach helps us in minimizing our dependency on external software/hardware/technology vendors. We also are in a very good position to incorporate customer feedback on to our solution stack – since we have total control on all layers of the solution. This approach has helped us to innovate constantly and maintain an edge over the competition.

Another complementary strategy we have executed in the recent years is to ensure customer stickiness. We have constantly delighted customers with superior service and helped them scale effortlessly as their businesses have grown. Thus, many of our initial customers have now migrated from using the low-value virtual PBX solution to leveraging our high value cloud contact centre solution. This approach has helped us both retain our existing customers, as well as ensured that we earn more working with them.

What internal measures have you taken to ensure that Ozonetel retains its edge in the marketplace?

From an operational perspective, we have ensured that the Organization has the best leaders in every functional area. Our founding team is a great mix of complementary capabilities that are required to drive excellence across all aspects of the company. Getting to specifics, on the Sales front, we have presence now in many cities. This helps in building and sustaining relationships with customers. We realized very early that physical presence is important to close a sale. Hence we took steps to ensure we were physically accessible to customer.

On the development and R&D front, given that we are a technology based company, we have a maniacal focus on developing the best solution using the latest technological developments in our domain. We have effectively used our prior working experience to provide superior post-sales support to our customers. We take customer care very seriously – and it also is one of our key differentiators from competition, due to our superior execution and empathy for customers. All these have ensured that Ozonetel as an Organization responds nimbly to external environmental changes.

On a related note, how important it is to have a good founding team? What characteristics of the top management team in your experience will enable success of the firm, especially in its formative years?

It is absolutely critical to have leaders with complementary skills in the top management team. It is also equally important that there is good chemistry between the founding team members. Once you have the above combination in place, you will automatically be geared to deal with the uncertainties and ambiguities that confront a nascent organization. In our case, I have been very careful in signing on our founding team and the top management team. I recommend that one closely work and observe the working style of any prospective founding partner that they want to bring on board. This helps in validating the nature of contributions that the person will bring in, as well as help understand if the person gels well with the rest of team members.

Another thing that I have realized from working across multiple ventures – is to recruit your sales leader up front – right from a very initial stage. This helps in enabling the Organization to grow rapidly at later stages. The Sales leader understands the other functional units of the company better due to the fact that they worked together in the initial stages. This bonding helps immensely as the company grows.

Thank you for your insights. As a parting question, what would be the top three things that you would advice to your fellow product entrepreneurs operating out of India?

As I reiterated, starting off with the right set of founding team members – in terms of complementary skills and good teaming is very critical to any enterprise, more specifically for a technology product based company. Secondly, as the founder, ensure that you hire right for the Organization. Do not compromise on skills or on any other aspects that affects the culture of the company. Thirdly, as many others would tell you, keep your ears close to the customer. Constantly delight them and seek to improve continuously. Success will surely follow!

28/10/201328/10/2013

21st #PlaybookRT – 13 Sales Mantras for Product Selling in India – Part 1

Last weekend, we had a playbook roundtable on sales(mainly B2B) at the Ozonetel systems office in Hyderabad. Aneesh Reddy from Capillary led the RoundTable. The focus of the roundtable was on sales in product companies. This included early stage sales as well as issues faced during scaling sales. A lot of points were covered and the participants were involved in very lively discussions with almost everyone learning something new from the others experience. So without further ado, the following were the main learnings from the roundtable:

1. Sales solves everything. The panacea for all the problems of a startup is sales. Somtimes even a PPT is enough to do sales. This was explained by Aneesh how in their Capillary journey they showcased their to be built product on PPTs to prospective customers and made the sale.

2. Initial sales has to be done by founders. This was universally accepted by all the participants. So every founder has to become a sales person. There is no second way about it. Once you scale to a certain level, you can look at hiring dedicated sales head and building a sales organization.

3. Freemium model does not work too well in India. Get a customer to pay something(maybe even Rs.100). Make the customer also invested in the product. Only then will they give the time necessary for your product and evaluate it properly. Pilots work well, but try to make them paid pilots.

4. In India Push sales work, for outside markets, consultative sales works. In all cases, your sales person should be willing to listen to the customer and understand his pain points.

Payment Collection

Payment collection is a big problem for SaaS products. Following up every month for the collections is a full time job. Some pointers to help in this are:

5. Quarterly, Yearly payments. See if you can push your customers to pay quarterly, yearly upfront. Give a discount two sweeten the deal. This is ok as you receive the money up front and you are reducing costs on processing collections.

6. Disconnect services. Most participants agreed that disconnection of service works as a deterrent to the customer. Give enough indications/alerts about the pending disconnection and follow up with a phone call for collecting your payment.

Lead Sources

7. List rentals. Aneesh suggested that buying the list of conference participants gave a better RoI than sposoring some event. So identify some good conferences in your domain and buy the participant list from the conference organizers.

8. Attend exhibitions. Exhibitions in well known places like HiTex in Hyderabad gave a lot of leads to the NowFloats team.

9. Subscribe to local magazines. Local magazines are a good source of business listings as all good businesses advertise in local magazines. Build your list by mining this data.

10. Employ a good PR agency. Once you are at some level of scale, it makes sense to employ a PR agency. The PR agencies have good contacts in the media and they will get you good coverage. Though, they may not directly get you leads, they will help in brand recall, hiring and fund raising efforts.

Inside sales:

11. Start with a 2-3 member inside sales team. Aneesh was of the strong opinion that inside sales is the way to go for B2B sales in India. Start small and monitor the team closely.

12. Invest and be patient. Sometimes, it takes around 3-4 months for an inside sales team to show some traction. be invested and be patient. Things will slowly pick up.

13. Team composition. One combination could be 1 data collector and 2 tele callers. Try different approaches and see what works best. To get started, you can out source the process, but that may turn out costly.

In the next part we will look at some metrics that will help us monitor sales.

04/12/201205/12/2012

Platform Play Versus Product Play in an Indian Scenario-Part 1

From the beginning, we at Ozonetel had always wanted to build a platform. Initially, we did a VXML platform with off the shelf hardware. But VXML was not sexy enough and there were not a lot of takers. So in 2010, we did a pivot and built our own custom hardware( PRI cards) and built KooKoo and top of it. KooKoo was our attempt at Telephony Platform as a Service play. Once KooKoo was opened to the developers it took off and we got good traction. A lot of innovative telephony apps were built on top of KooKoo and telephony became cool again.

After 6-8 months, we started to think about building products and do a product play. A couple of things influenced our decision to do a product play. First was that though innovative telephony apps like connecting experts, water alerts, appointment reminders etc were being built on KooKoo, core telephony apps like PBX systems and call centers were not being built and there was a huge market opportunity. Second was that, being a bootstrapped company, market forces made us to look at alternative sources of revenue as the customer turnaround time in a platform play is longer. They have to first build their apps, market them, make money and then only they pay us 🙂

So with that, we separated out a product team in Ozonetel who would go on to build two core telephony products, a PBX on the cloud called asBizPhone and a full featured cloud call center product called as Cloudagent. So now that I have seen both the scenarios of a platform play and a product play, I thought I would share some pointers in both(no particular order).

Platform Play:

Patience: You should have a lot of patience. Developers will take their own sweet time in building the application and marketing it. Many times, you will want to get in and help them develop. But that is not scalable. Though it will take time, it is better for them to figure out the solutions on their own as in the long run that will mean lesser support.
Documentation: This is the most important part. You wont believe the amount of support calls that are reduced by having some decent documentation. Unfortunately, this is one area where we still have to improve and thats why we still get support calls.
Logging: Your platform should explain what is happening behind the scenes to the developer through logs. It will help them in debugging the issue themselves before they reach out to support.
API: Think through what and how you want to expose your API. Because, once you open it to the public and they start using it, it will be really hard to take back and you will end up supporting multiple versions.
Evangelize: You should have a team of evangelists who should go to events, do live coding, help hacking communities etc to drive adoption. This is the hardest part, convincing developers to invest their time in learning your platform. It is much harder in India as the hacker community is in a nascent stage(though growing very very well).
Star products: Every platform should have some star performers. They are the ones which will help in people believing in your product. Identify your star products and put all your efforts in making sure they succeed.
Mashups and Blog: Build mashups on your platform yourself to showcase the capabilities. You know your platform best, so you will have to build very innovative and fun apps. After building mashups, blog about them and spread the word. Again, in India, its hard to build mashups with content from an Indian context. Till last year, we did not have a lot of APIs for Indian content. But now a lot of companies like Zomato have started opening up APIs and phone mashups can easily be built.
Support: This will make or break your platform. Developers have very little patience. If they send a mail to support, they better get a response within 5-10 minutes. Otherwise, they will end up Googling for another platform which will solve their platform. Luckily, so far at least we have been able to keep our developers happy with our support. Support does not just mean technical support. Many times we have actually had to mentor a lot of startups building on our platform. You should be willing to listen to their problems and suggest advice if you have any.
Developer events: You should conduct developer events and hackathons so that the new developers get to know about your platform. Unfortunately, being bootstrapped, we have not yet had funds to do this 🙂
Sponsor events: In addition to conducting events, another way of getting mindshare of developers is to sponsor events. We are continuous sponsors of Startup Weekend events in India and have also sponsored hackathons in colleges like BITS where students have built very innovative applications.

In the next part I will discuss my observations on the product play.

Guest Post by C. Chaitanya, Ozonetel