(COMPETITION)
The Way I Work
AUGUST 2010
HOW TO KEEP TABS ON
K GANESH TUTORVISTA PAGE 64
THE EXPAT CLUB OF COMMERCE
The Magazine for Growing Companies
Sheikha Mattar-Jacob co-founder Masala Tee
Lalita van Lamsweerde founder Bagel’s Cafe
Noelline Besson co-founder Masala Tee
THE EXPAT CLUB OF COMMERCE
GRITTY
TALES OF FOREIGNERS
WHO HAVE
BUILT SUCCESSFUL The MAGAZINE for GROWING COMPANIES
BUSINESSES
IN INDIA
Iris Strill co-founder PurpleJungle
HOW TO SPIN OFF BUSINESSES PAGE 57
MASTER OF THE COLD CALL PAGE 50
August 2010 | Rs.150 | Volume 01 | Issue 07 A 9.9 Media Publication
The thaw in the
IPO MARKET
PAGE 09
August 2010
CONTENTS
The Ultimate Romance Francis Wacziarg not only runs businesses in India, he’s even become its citizen since 1990.
28 United Colours of Entrepreneurship Tales of foreigners who came, saw and conquered the hardships of an alien environment to build innovative ideas into successful business ventures in India.
30 Bagel’s Cafe: A story
33 S2 Spa: Rejuvenating
39 Shanti Travel: How
of Dutch (and other continental) delights.
the Indian beauty industry.
people are queuing up for made-to-fit tours.
32 The French Farms:
35 Darren Odell: Travelling through India’s ancient by lanes.
39 S Purushothaman: A
A piece of exotic meat for the chicken-devouring Indian. COVER: LOCATION COURTESY RELIGARE ARTS INITIATIVE. THIS PAGE: SUBHOJIT PAUL
37 Masala Tee: Dressing up the uppity fashionistas.
36 Flying Fox: Zipping through adventure.
Malaysian serial entrepreneur chooses India for her next innings.
51 Special Feature There’s No Such Thing as a Wrong Number
41 Kreeda Games: Playing on India’s growing internet frenzy.
42 Gotcha!Media: You got sold! Advertising makes a washroom stop. 44 Purple Jungle: Products that bring alive India’s vibrant culture.
46 Neemrana Hotels: Beyond the mundane fivestar, non-hotels lure in the discerning customers.
And eight other nuggets of wisdom from David Rosen, salesman extraordinaire by john grossman
THIS EDITION OF INC. MAGAZINE is published under license from Mansueto Ventures LLC, New York, New York. Editorial items appearing on pages 3, 12-13, 20-21, 23-25, 50-58, 62-63 were all originally published in the United States edition of Inc. magazine and are the copyright property of Mansueto Ventures, LLC, which reserves all rights. Copyright © 2009 and 2010 Mansueto Ventures, LLC. The following are trademarks of Mansueto Ventures, LLC: Inc., Inc. 500.
on the cover
(Standing from left) Sheikha Mattar-Jacob and Noelline Besson, founders, Masala Tee. (Sitting from left) Lalita van Lamsweerde, founder, Bagel’s Cafe; and Iris Strill, co-founder, Purple Jungle. Photographed by Vijay Kutty at the Religare Arts Initiative in Delhi. Cover design by Binesh Sreedharan
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CONTENTS
August 2010
20
14 57
23
04 Mail 05 Editor’s Letter
06 Behind the Scenes Flour, chocolate and innovative packaging—just a few things that delight customers at Flurys in Kolkata.
09 Launch
The thaw in the IPO market The Ticker A gathering of business minds in Bengaluru
12 Get Real
By Jason Fried Conflict is inevitable. But it doesn’t have to be harmful.
14 Passions
Narayan Krishnaswamy’s heart beats for the djembe, an African drum.
16 Earn Your Spurs
By Jessie Paul There’s no point in being the world’s best kept secret. If customers cannot find you, how will they buy your product?
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18 Innovation
Blocking radiation to make the world a healthier place.
20 Balancing Acts
By Meg Cadoux Hirshberg When one spouse works for the other, things get delicate. Or, they had better.
23 The Goods
Wi-Fi routers for a wire-free world A new improved phone stand Bluetooth ear pieces from Platronics A new way to hunt and gather Storing IDs online while travelling LED television sets to adorn your wall Cord-free Sony Walkman W250 How Yammer helps Tim Miner manage his business and messages Things That Phanindra Sama Cannot Live Without
Guidebook
How to keep tabs on competition. Find the Guidebook following page 23.
68 I Wish I Knew Then...
Amarjit and Gunita Singh While building Intec into a Rs 190-crore manufacturing business, the couple learnt a lot from their foreign partners.
STRATEGY 57 MANAGING How to spin-off businesses. 59 SALES & MARKETING A composter that converts household garbage into organic manure. Advice from four entrepreneurs on how to get market their green services. 62 ELEVATOR PITCH Gaboli manages alumni for educational institutions. Can Rs 5 crore foster growth? 60 SALES & MARKETING Four reasons to open pop-up stores.
64 The Way I Work
Serial entrepreneur K Ganesh powers up Tutor Vista with his post-lunch 30-minute naps. And, some sound feedback techniques. by jacob cherian
Inc.com
10 THINGS TO DO
ONLINE THIS MONTH
CONTENTS
1. Start Your Business Plan Inc.com’s Business Plan Workbook provides a detailed, fill-in-the-blank outline that will help you organise your ideas prior to launch and execute the plan as you get under way. www.inc.com/tools/business-plan-workbook.html
2. Organise the Inbox
It can be a daunting task, but purging your e-mail inbox can help you avoid missing deadlines, frustrating your staff and neglecting customer complaints.
10. Hit the Road
Want to start a food truck business? Here’s a look at the big issues: marketing, maintenance, staffing—and pleasing the parking gods.
www.inc.com/ guides/2010/05/manageemail-inbox.html
3. Increase Your Valuation
www.inc.com/ guides/2010/05/opening-asuccessful-food-truck.html
Entrepreneur John Warrillow shares five ideas on how to get a higher multiple when you sell your company.
9. Disrupt Your Rivals
www.inc.com/ articles/2010/04/getting-thebest-valuation-for-yourbusiness.html
Mark Johnson, co-founder of Innosight, the Boston-area consulting firm, answers questions on how to dislodge entrenched competitors in even the most staid industries.
4. Optimise Your Videos for Search
www.inc.com/ inctv/2010/05/inc-livemark-johnson.html
Google’s search rankings give added weight to Web video, which means you should always look for ways to optimise it. Here are eight tips on doing it right.
8. Create a Safer Workplace
www.inc.com/ guides/2010/05/searchengine-optimization-forvideo.html
www.inc.com/ guides/2010/05/9avoidable-workplacehealth-safetyhazards.html
7. Get Certified
Becoming officially certified as a Woman Business Enterprise involves a fair amount of red tape, but it’s usually worth the effort. www.inc.com/ guides/2010/05/womenowned-businesscertification.html
6. Fight an Unemployment Claim
Is a former worker filing a frivolous claim? Here’s how to contest it. www.inc.com/ guides/2010/04/contestunemployment-claim.html
5. Make a Bundle on Etsy
CLOCKWISE FROM TOP: COURTESY STREET-ZA; PHOTOS.COM
The nine most common workplace accidents are fairly easy to prevent. Here’s how.
The online craft market’s most profitable sellers share their tips on how to boost a business’s visibility and customer base. www.inc.com/ guides/2010/05/ sell-handmadecrafts-on-etsy.html
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MAIL JULY 2010
REDUCE YOUR ENERGY BILLS
HOW VINOD KAPUR BUILT KEGG FARMS PAGE 52
BEST
MEETING
JOINTS IN FOUR CITIES PAGE 23
TURNING AROUND A
TOXIC
—DAVID C MATHEW
PAGE 51
THE TOUGHEST LAPTOPS PAGE 21
The Way I Work Ranjan Chopra Team Computers PAGE 64
The MAGAZINE for GROWING COMPANIES
Glad that I picked your magazine at the stand. I did read it end-to-end in a single go. Very refreshing and inspiring too. PS. I did not know that a magazine like this existed and am glad that I took the chance.
HOW TIME MINTS MONEY FOR THIS MAN
Good buy
WORKPLACE The Magazine for Growing Companies
Why Jason Fried does not want you to read another resume PAGE 10
Best Practices from America’s Best-Run Companies PAGE 42
HOW
TIME MINTS MONEY FOR THIS
MAN
YASHOVARDHAN SABOO
built India’s top watch components company. Now, he wants a piece of retail action with his 22-store chain selling luxury watches. PAGE 26
July 2010 | Rs.150 | Volume 01 | Issue 06 A 9.9 Media Publication
Real and useful Hello Madam, Inc. magazine, the topics are so real and useful. I personally use many of the suggestions for the betterment of my company. Keep up the good work. Thanks & Regards, rajiv warrier
Managing Director Aladdin Multimedia
Careful in selection Have been reading the magazine with great interest and have found it very informative.
MANAGING DIRECTOR: DR PRAMATH RAJ SINHA PRINTER & PUBLISHER: ANURADHA DAS MATHUR EDITORIAL MANAGING EDITOR: POOJA KOTHARI ASSISTANT EDITOR: JACOB CHERIAN ASSISTANT FEATURES EDITOR: ROHINI BANERJEE CONSULTANT FEATURES EDITOR: PAYEL MUKHERJEE FEATURE WRITER: SUNAINA SEHGAL DESIGN SR CREATIVE DIRECTOR: JAYAN K NARAYANAN ART DIRECTOR: BINESH SREEDHARAN ASSOCIATE ART DIRECTOR: ANIL VK MANAGER DESIGN: CHANDER SHEKHAR SR VISUALISERS: PC ANOOP, SANTOSH KUSHWAHA SR DESIGNERS: PRASANTH TR, ANIL T & SURESH KUMAR DESIGNER: SRISTI MAURYA CHIEF PHOTOGRAPHER: SUBHOJIT PAUL COMMUNITY TEAM PRODUCT MANAGER: MAHESH RAVI MANAGER: SHREYA PILANI ASSOCIATE: DEEPIKA SHARMA
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However, in your April issue, I came across an article on “How to read a term sheet”. This was indeed a good topic to be covered in view of the increasing private equity funding. But on going through the same, I found that it was not at all in line with the Indian context and requirement. It was completely an American term sheet, which would have hardly any significance for the Indian market and entrepreneur. This serves no purpose for the Indian entrepreneur, who needs to understand the term sheets prepared in an Indian context and
laws therein. I hope you will keep in mind this aspect when publishing future articles. These are my personal views, as I am into financial services and we have to, many a times, explain the term sheets to our clients and hence my views on your above article.
SALES & MARKETING VICE PRESIDENT: NAVEEN CHAND SINGH NATIONAL MANAGER (ONLINE SALES): NITIN WALIA NATIONAL MANAGER (EVENTS AND SPECIAL PROJECTS): MAHANTESH GODI REGIONAL MANAGER (SOUTH) VINODH K (+ 91 97407 14817) REGIONAL MANAGER (NORTH) PRANAV SARAN (+ 91 93126 85289) REGIONAL MANAGER (WEST) SACHIN MHASHILKAR (+91 99203 48755) MANAGER (KOLKATA) JAYANTA BHATTACHARYA (+91 93318 29284)
OFFICE ADDRESS 9.9 MEDIAWORX PVT LTD A-262, DEFENCE COLONY, NEW DELHI–110 024
PRODUCTION & LOGISTICS SR GENERAL MANAGER (OPERATIONS) SHIVSHANKAR M HIREMATH PRODUCTION EXECUTIVE VILAS MHATRE LOGISTICS MP SINGH, MOHD. ANSARI, SHASHI SHEKHAR SINGH
hemant shaparia
To submit a letter, or alert us to an error, write to us at editor@incindia.in Letters may be edited for space and style. Submission constitutes permission to use.
PUBLISHED, PRINTED AND OWNED BY NINE DOT NINE MEDIAWORX PRIVATE LIMITED. PUBLISHED AND PRINTED ON THEIR BEHALF BY ANURADHA DAS MATHUR. PUBLISHED AT A-262, DEFENCE COLONY, NEW DELHI–110 024 EDITOR: ANURADHA DAS MATHUR PRINTED AT SILVER POINT PRESS PVT LTD, PLOT NO. D-107, TTC INDUSTRIAL AREA, SHIRVANE, NERUL, NAVI MUMBAI – 400706
EDITOR’S LETTER
Fascinating tales of entrepreneurship These days, our dinner-time conversations are centred on updates from my entrepreneur-husband on his latest venture. The PAN card for the new company arrived, albeit much beyond the promised 24 hours. The invoices arrived long before the bank account got activated. And, the scanner got stuck due to an import code. The air conditioner was delivered even before the doors to the new office were! And so on. It’s almost as if each day brings a new challenge, without any sign of revenue. Many a times, it makes me wonder why people become entrepreneurs in the first place. It’s just so much easier to deliver the KRAs and collect the pay cheque—month after month. Yet, as I watch the husband, I know that he wouldn’t trade his office-in-the-makTHINGS I LEARNT IN THIS ISSUE ing-for-two-months-now for Don’t have to get any other address—elite or past a gatekeeper not. There’s something about the first time round. watching the business take Persistence pays shape; it’s almost as much fun here as well. as watching your firstborn Spinning a non-core take his first steps and utter business into a his first words. separate company may actually help As I read the stories of our retain the stars. cover package that poured in There’s something from our writers, I was called a pop-up store amazed at these foreigners, that can spread the who have built successful message about your businesses in an absolutely brand—without new environment. If I costing you a lot.
thought my husband was having a hard time, imagine these expats, who didn’t know the local language and who faced so many more cultural constraints that are absent from an Indian’s list of woes. Despite the hardships, they’ve made India their home for years at end to watch their businesses grow— and succeed. As Ema Trinidad, one of these expats, put it, every challenge faced in India is almost a new business opportunity. It surely is this optimism that makes them entrepreneurs! In fact, I really agonised over including the story of Neemrana Hotels in this package. Francis Wacziarg isn’t even a foreigner now. And talking just about him would do such a disservice to Aman Nath, his partner in these “non-hotels”. However, no matter who I spoke to, Wacziarg’s name cropped up as the ultimate “expat story” of India. So, with due apologies to him—and without undermining his Indianess—we include him in this cover story. It’s a coincidence that these expats make our cover in the month India celebrates its Independence Day. Happy reading!
Pooja Kothari pooja.kothari@9dot9.in
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BEHIND THE SCENES
Companies at the heart of everyday life
Dairy products Whether it’s the fluffy pineapple pastry, or the gooey blueberry cheesecake, or even the regular lift-me-up brownie—none would have been half-as-good if Flurys didn’t have a regular supply of fresh dairy produce. It is Eastern Dairy that helps Flurys live up to its reputation of providing the creamiest and fluffiest pastries in town. Founded in 1994 by Tapas Kumar Pal, the firm supplies dairy products to Flurys twice a week and to other regular clientele consisting of hotels, restaurants and confectioneries. With 10 employees, Eastern Dairy enjoys a turnover of Rs 2 crore per annum.
Packaging boxes Customers on Kolkata’s famous Park Street are often lured in to this iconic confectionery joint by the sight of mouth-watering pastries and cakes. Often, guests are tempted to carry the delectable goodies with them, thanks to the colourful pick-me-up boxes that catch their eye the moment they step in through the shop’s massive glass doors. These are provided to the 83-year-old Flurys by Quintessentially/Innovation & 3rd Millennium, a local firm founded by Hemant Bhalwala in 1993. The Rs 2-crore firm works on a contractual business model, serving fivestar hotels, such as ITC Sonar Bangla, Taj Bengal, Hyatt and The Park. Its 15 employees also cater to corporate clients in the power and IT sectors.
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Flurys, Kolkata
15.07.10 03:30 PM
Hed tk Flour quat. Ut wis nit vulland ipsusci eugue magnis-
sectem dolorperit, quatum del utmess et volobore If their cakes create a gooey in your moUptat iriure el digna cortisi praessi mouth, the do crunchy and light tat biscuits define etum velenibhteatimes. exerciduip eugaitsecret incinisingredient? elisi. Kolkata’s Flurys Sandionsed et, flour, sequips uscing exerilit do Top quality which is supplied bydolore Shreya velitEnterprises at. Andrem duis ea facinciprice liquatio od1,400 at analisi impressive of Rs magnisi. Dui num dipit founded per kg to ea Rsatem 90 per kg. dolut Ajayalore Agarwal the firm in 1995, and provides at least 120 bags of flour to Flurys every 10 days. With only five employees, Shreya’s annual turnover is Rs 5 crore.
Chocolate Flurys chocolates are touted to be the “best Swiss variety outside Europe”. It would be a sacrilege if the raw chocolate supplied by Vivek Associates lacked that extra oomph. Established in 1987 by Deepak Tiwari, the firm provides around three tonnes of chocolate every month to Flurys. That is, however, on regular days. Between December and February, this goes up to seven tonnes to meet Kolkata’s Christmas and New Year frenzy. The Rs 20-crore firm counts Taj Bengal, Oberoi, The Park and other biscuit and ice cream manufactures among its clients. The firm employs 20 people.
PHOTOGRAPH BY DRISHTI
REPORTED BY DEEPIKA SHARMA
News, Ideas & Trends in Brief
LAUNCH
Good Time To Raise Some Moolah The IPO market is coming back to life, sort of Thanks to the global economic meltdown, 2009 was almost a write-off as far as the market for initial public offerings (IPOs) was concerned. Things seem to be warming up, though. Between January and June this year, 27 companies sold shares in the public market for the first time, compared with three in the same period last year— raising more than Rs 4,900 crore in the process, as against Rs 324 crore last year. (These numbers are only for IPOs below Rs 1,000 crore.) What’s more, there’s a medley of midsized IPOs expected in the second half of the year, including Glenmark Generics, in pharmaceuticals, Bajaj Corp, a personal care company, Va Tech Wabag, a water resources company and Gujarat Pipavav Port, a shipping company. Each is hoping to raise between Rs 400 crore and Rs 600 crore from the market. Oberoi Realty and Raheja Universal, in the real estate sector, also intend to try their luck this year. IMAGING BY SURESH KUMAR
It may not be anywhere near the highs of the bull-run seen between 2005 and 2007, but things aren’t looking as bleak as last year either. The stock market has recovered from its lows, and should pull the IPO market up as well. The economy is growing at more than 8 per cent in this fiscal. However, there are no clear favourites this year. Says Manish Shah, associate director, equities and derivatives, Motilal Oswal Securities: “The key differentiator is the quality of the business.” Yet, it’s not enough that a company has the right credentials. The buyer is rather price-sensitive at this time. “This year, highlypriced IPOs have not done well, though the company may be good,” adds Shah. No one envies these companies; the task of raising money in such an environment. As Privthi Haldea, chairman and managing director, Prime Database, says: “How can a company plan an IPO when it can’t be sure of markets remaining stable in the
next 35 days, which is the gap between announcement and listing dates?” Given the circumstances, success of some firms that managed to do well in their IPOs is all the more commendable. While there is no formula for success, here is a look at some of the front-runners, of this year and what made them raise funds successfully from the public. PERSISTENT SYSTEMS
A software product development company, it focuses on the telecommunications, life sciences and infrastructure and systems verticals. In 2009, it was recognised as one of the leading technology companies by Deloitte Touche Tohmatsu in its ranking of Technology Fast 500 Asia Pacific. Industry recognition, the strength of its products and its above-average fundamentals seem to have gone in its favour. continued on the next page
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LAUNCH
Good Time To Raise Some Moolah continued Incorporated: 1990 Employees: 3,500 Rating: CRISIL IPO Grade 4 IPO: March 2010 IPO size: Rs 168 crore Oversubscribed: 92.86 times DQ ENTERTAINMENT (INTERNATIONAL)
It produces animation, visual effects, game art and entertainment content for the media and the entertainment industry, both here and oversears. It also produces and distributes television series, direct-to-home videos and feature films. Incorporated: 2007 Employees: 3,500 Rating: Fitch IPO Grade 3 IPO: March 2010 IPO size: Rs 128 crore Oversubscribed: 69.61 times JUBILANT FOODWORKS
The master franchisee of the well-known brand, Dominos Pizza, it holds exclusive rights to operate in India, Nepal, Sri Lanka and Bangladesh. Dominos is the largest pizza chain and one of the fastest-growing multinational fast food chains (in terms of number of stores) in India with 274 stores in 55 cities. Though its fundamentals were rated average, the aggressive marketing of its IPO seems to have worked in its favour. Incorporated: 1995 Employees: > 6,000 Rating: Fitch IPO Grade 3 IPO: January 2010 IPO size: Rs 328 crore Oversubscribed: 27.26 times ARSS INFRASTRUCTURE PROJECTS
The company constructs railway infrastructure, roads, highways, bridges and irrigation projects, and is especially active in eastern 10
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India. It is executing a number of big-ticket projects (valued at above Rs 50 crore) either alone, or as part of joint ventures. The fact that its profits doubled between 2007-08 and 2008-09 helped turn investor sentiments in its favour, in spite of a belowaverage rating. Incorporated: 2,000 Employees: 2,725 full-time employees Rating: CARE IPO Grade 2 IPO: February 2010 IPO size: Rs 103 crore Oversubscribed: 51.27 times TALWALKARS FITNESS
It is one of India’s largest fitness chains offering wellness services. It has 51 health clubs in 24 cities serving more than 55,000 members. It improved its brand recall in the recent past by participating in Standard Chartered Mumbai Marathon and the Femina Miss India contest. Incorporated: 2003 Employees: 3,000 Rating: CARE IPO Grade 3 IPO: April 2010 IPO size: Rs 77 crore Oversubscribed: 28.20 times UNITED BANK OF INDIA
It has more than 1,500 branches in rural and semi-urban areas, which give it access to an exclusive customer base. This worked in its favour at the time of the IPO. It was ranked above-average and was perceived to be a good medium-term investment. Incorporated: 1950 Employees: 16,768 (including part-time employees) Rating: CARE IPO grade 4 IPO: February 2010 IPO size: Rs 325 crore Oversubscribed: 33.19 times
—Charu Bahri
The Ticker With a new currency symbol, Index of Industrial Production up by 14 per cent for April and May, and corporate profits soaring by 23 per cent, India’s rocking once again!...Not surprising that a mark this Bain & Company survey says that PE investments are likely to quadruple this year to US$17 billion. Both deal and stake sizes are expected to go up…The infrastructure and energy sectors continue to attract private equity investors. India Clean Energy Fund (of PE firm FE Clean Energy) is investing US$50 million, along with IFC, in Bhilwara Energy, promoted by the Ravi Jhunjhunwala-led LNJ Bhilwara Group. Famous for textiles, the group’s diversifying into hydel power…Eredene Capital is investing US$11 million in Ocean Sparkle, a Hyderabad-based green is in port operations and marine services company founded by four marine technocrats led by P Jairaj Kumar…India Value Fund Advisors is planning to invest Rs 90 crore in New Delhi-based UEM Group, which specialises in water and waste water treatment and disposal…After Allcargo Global Logistics and Nagarjuna Construction, PE biggie Blackstone is picking up a 12.5 per cent stake in Sandeep Jajodia-led Monnet Power Company, which develops mine-mouth coal-fired power plants…The shoe is clearly on the other foot, as our infrastructure-PE expert Luis Miranda plans to move on as CEO of IDFC PE. mahajan Investors and LPs in the fund are said to be worried about the future with their “key man” moving on… Vijay Mahajan, India’s foremost microfinance entrepreneur and founder CEO of Basix, is the new executive committee chairman of World Bank’s Consultative Group to Assist Poor.—Inc.India team
LAUNCH
A Meeting of Business Minds Exploring social media, mythology and management, and much more
Pearls of wisdom The audience, consisting of founders and CEOs of midsized firms, was participative and inquisitive through the day-long event in Bengaluru.
When sixty five business owners and
founders got together last month in a conference hall at the swish Oberoi in the heart of Bengaluru, they weren’t anticipating being asked whether they wanted to be Vishnu or Indra in their approach to business. The occasion was the Second Regional Growth Summit organized by 9.9 Media, the parent organisation of Inc. India magazine. On the dais was Devdutt Pattanaik, the keynote speaker and chief belief officer of the Future Group, drawing parallels for management from Indian mythology. In the pursuit of growth, businesses need to look beyond “how to grow” and towards “why” and “for whom” to grow. A medical doctor by education, a leadership consultant by profession and a mythologist by passion, Dr Pattanaik held complete sway over his audience with his observations about the “Indian way” of doing business and ideal qualities of a leader. He urged businesspeople to think more like Vishnu,
the preserver, who is pursued by Laxmi, the goddess of wealth, and less like the insecure Indra, who’s in constant pursuit of wealth and prosperity. In mythology, the goddess is shown to pursue Vishnu, even as Indra keeps chasing her. A great leader is caring like Vishnu, caring about the material, intellectual and emotional growth of his people, and not like the self-focused King of Gods, who’s only worried about his own throne. This wasn’t the only session that had the audience take down notes furiously. The session that brought together veteran Anand Sudharshan, chief executive and managing director of Manipal Education, and ‘young turk’ Keshav Baljee, president of Royal Orchid Hotels and the scion of the Baljee family that owns this chain of hotels, ensured the debate on “old vs new blood” had a balanced representation. Baljee pointed out that the best way for younger family members to bring in new initiatives was to work towards proving their usefulness, rather than forcing them into the organisation.
When Mahesh Murthy, a columnist for Inc. India and a venture capitalist and an expert on digital media marketing, spoke about how companies can leverage social media, many in the audience questioned him even over lunch on how they could manage their online reputation and presence. The highlight of the event was the interview with serial entrepreneur K Ganesh, CEO and founder, TutorVista, who was asked many questions on his entrepreneurial journey since 1990, including selling his three ventures. “You may love your daughter, but you do want her to get married and make a home of her own,” he defended his exits. Read more about his days at work on Page 64. The last session on fund raising, which featured two entrepreneurs and one investor on the panel, was the perfect ending to the day. Jacob Kurian, a partner with New Silk Route Advisors, listed out useful tips on preparing for a meeting with investors. —Inc. India team. AUGUST 2010
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GET REAL BY JASON FRIED
Managing Conflict
At a fast-growing company, arguing is inevitable. But it needn’t be harmful it flows downhill; and, if left unchecked, it erodes whatever it touches. And sometimes it’s like red wine—it stains. We’re an opinionated bunch at 37signals, the software company I cofounded. That is true whether we’re dealing with the outside world (in our blog posts, conference talks, interviews, etc.) or with one another. And since we’re a semi-virtual company with people in 12 different cities, we don’t have the benefit of body language to help inform the subtleties of discussion. Because we can’t see one another, we can’t serve up a smile or a “You know what I mean” glance to defuse a conflict in the making. Breaking a Stalemate Conflict can be a good So we’ve learned a few things about tant and complicated, the odds are that thing, if managed well. When people dig in managing conflict. Conflict, of course, can be and defend their positions, a deeper no matter how much you believe in your a downer. But managed conflict is a good understanding of a problem is possible. idea, someone else believes in his or hers thing—it’s fertile ground for a great exchange just as strongly. Maybe you’ve convinced of ideas. When people dig in and defend their yourself, but the others aren’t convinced. positions, a deeper understanding of a problem is possible. As long Or maybe they haven’t convinced you. How do you break the staleas people are defending a genuine idea and not just their pride, mate and get to a decision? much can be learned. First, it’s worth taking a step back and considering if you’re even Making a case is one thing. Making a convincing case is some- disagreeing. Sometimes what looks like a disagreement is just an thing else entirely. Convincing yourself of something you sense is agreement cloaked in competing vocabularies. true isn’t very hard, but convincing someone else is. It makes you I think of this as “faux conflict,” and I see it happen a lot—espethink harder about what you believe and why you believe it. And cially when people with different skills are involved. That’s because sometimes that alone will help you see the other side—and maybe programmers speak one language, designers another, managers yet even change your mind. another. Someone in marketing calls it this, while a customer calls it Of course, if you want to get stuff done, a decision eventually has that. Basic misunderstandings cause a fair bit of conflict. to be made. Decisions are progress. But when decisions are imporI remember when we were working on a new feature for High-
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PHOTOS.COM
Conflict is a lot like water—it spills over;
GET REAL
rise, our contact-management tool. This particular feature was designed to keep track of conversations users have with their contacts. One designer called the logging of the conversation a “message.” One programmer called it a “note.” Another programmer called it a “recording.” And I remember calling it a “post.” We were all talking about the same thing, and we all fundamentally agreed about how it was supposed to work, yet we soon found ourselves arguing about it. Why? Because none of us were exactly sure what the others were talking about. If we had done a better job of defining our terms at the outset, there would have been a lot less argument, stress, and wasted time. Simple. This is why we try to get real with things as quickly as possible. For us, real means something we can all look at—a picture, a sketch, something visual. Until everyone’s looking at the same thing, it can be hard to reach actual agreement. Five people may read the same paragraph, but they often interpret the words differently. But when you look at a picture, a mock-up, people are more likely to reach agreement—or valid disagreement. Whichever way they go, at least we know where they actually stand, not where we think they stand. Pointing at something real cuts through to the truth. If you find you do have genuine disagreement, then you can move on to some techniques to help resolve the conflict. One triedand-true method, of course, is brute force: The highest authority makes the call. That could be a founder, CEO, president, or manager. In some cases, this has to be done. But mostly I’ve found that it leads to lousy morale and bruised egos rather than genuine agreement. In fact, the person at the top doesn’t always have the right idea. And the farther he or she is from the actual work being done, the less likely his or her idea will be the right one. Nonetheless, almost all entrepreneurs would admit that it’s tough not to play dictator. I certainly know the feeling. When it’s your company, your vision, and your ultimate responsibility, it’s easy to think you have to make all the calls, all the time. But if you really start behaving that way, you’ll see the quality of work steadily decline. If your colleagues know that you’re just going to come in and tear down whatever they’ve been working on, they’re not going to give you their best work. Why would they? If it’s never going to be good enough for you, then it doesn’t matter how bad it is, either. So here’s how we turn conflict into something positive and get stuff done at 37signals. We trade. This method is based on the highly non-scientific “I’ve got this one; you get the next one” model used by millions of people every day. You know how it goes: You grab lunch with a friend, and you pick up the tab. Next time, he gets it. You don’t really keep track, because you know it’ll all even out in the end. And even if it’s not even in the end, it’s even enough. So sometimes, when we’re battling over a detail in one of our products, someone will eventually cede the decision to someone
else: “OK, we’ll go with your idea this time. Next time, it’s mine.” It’s not always that literal, but the intention is implied. It’s simply not worth battling every last decision until one side is too beaten up to battle anymore. Sometimes, a friendly “You get this one; I get the next one” is all it takes to move on, egos intact. A variation on this theme is to ask the question “Who really wants it more?” early in the process. It’s pretty rare that two people (or groups of people) all share the same degree of passion about a particular problem. Someone almost always cares more. She has more invested or a stronger opinion or just needs to win this one more than the others. So sometimes, that’s all that’s required: Just ask. Find out who really cares more and then give it to her. One day you’ll care more about something and you’ll get it. I’ve found that it all tends to even out in the end. Another great way to see who’s really willing to stand behind an idea is to find out if he or she is willing to take responsibility for it should things go wrong. Say we’re battling over a new feature for our software. One faction is certain that the feature will cause problems for our customers, while the other insists that things will work out fine. In most cases, we’ll let the optimists prevail, but with one key condition: They take responsibility for handling all the customer service and support issues that might arise. So if it turns out that the customers are complaining or things go wrong in general, it’s on their backs. They have to answer the e-mails
It’s not worth battling every decision until one side is too beaten up to battle anymore. Sometimes, a friendly “You get this one” is all it takes to move on. and deal with the backlash. When someone is willing to shoulder that burden, there’s a good chance he or she has the right idea. Of course, you don’t just give away decisions to people who aren’t capable of making them. I’m not suggesting making crappy calls just to avoid long-term conflict. In all of this, I’m assuming that everyone is making valid points for the most part. If someone is uninformed or arguing for the sake of arguing, the worst thing you can do is hand it over. At 37signals, we’re all reasonable and competent people. I hope that’s true of your company as well.
Jason Fried is co-founder of 37signals, a Chicago-based software firm, and co-author of the book Rework, which was published in March. AUGUST 2010
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PASSIONS
Life Outside the Office
Narayan Krishnaswamy truly loves music. He can sing, compose and play the guitar. But it is the djembe that gets him grooving. He owns several percussion instruments, of which four are djembes. And every Sunday, he brings the house down as he jams with a group of friends. Krishnaswamy, co-founder of Bengaluru-based HR consultancy, Talking Heads, bought his first drum in 2002. Since then, he has been playing daily at home, and with a band once in a while. “The tension and resolution of music is mirrored perfectly in business life. When a note hangs in the air, it needs to find a home to create harmony. Similarly, so many things cause tension in business. Ultimately, they get resolved and the business moves forward,” says he. Well composed!
The armory Nut-tuned djembe Rope-tuned djembe Doumbek, a belly dancing drum Cajom, a Flamingo drum All the world’s a stage Wrote music for Nariyal Pani Played at Christ College, Bengaluru Performed with the theatre group, Rafiqui Played at Alliance Française, Bengaluru
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Narayan Krishnaswamy
Djembe
“Music is the only thing I love unconditionally in my life.”
PHOTOGRAPH BY S RADHAKRISHNA
REPORTED BY POOJA KOTHARI
EARN YOUR SPURS BY JESSIE PAUL
Are You the World’s Best Kept Secret? It will be difficult for customers to buy your product, if they do not even know that your brand exists
head of Infosys was quoted saying that the IT firm’s unaided brand recall was 8 per cent in the US. That’s the biggest market for this US$5 billion firm. He went on to add that Infosys was now in the “second level”, after “big spenders” such as IBM and Accenture, both multinational giants. His confession brings us to a question that has nagged me for long—why do most Indian firms shy away from joining the league of “big spenders”? The last time I checked, I was given the following explanation: a business-to-business (B2B) firm sells to a specific, qualified audience, therefore, there is no need for it to be known beyond that closed community. My Fellow Indians Announce your Cisco, which sells high-end networking equipment to comwould take much longer. existence. And watch the market panies, is also, primarily, a B2B firm. Yet, last year, it ran a mass And given the importance of share of your product go up. media campaign in India on the “human network” theme— the Indian market, the firm many of you might recall its ad campaign with the cute wedding couldn’t take the risk of scene with tele-presence. Cisco is also involved in numerous corporate social someone else grabbing a piece of the pie—it was imperresponsibility activities within the community, and is well integrated with the ative that Cisco be the provider of choice, and fast. local business people. In my previous column, I talked about answering I asked one of its brand folks in the US why they were investing so much in three key questions as a business—who am I? Why buy building mass awareness, especially when their potential buyer base was quite me? Why not buy someone else? However, having the narrow. His response was that while a targeted approach might cost lesser, it right answers to these questions will not translate auto-
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PHOTOS.COM
In a recent interview, the brand
EARN YOUR SPURS
matically into sales—if your clients don’t know that you exist. Your product, or service, has to make the consideration set of the buyer before actually being chosen. Clearly, awareness is important to sales. And, there are two ways to building that awareness: The quick, capital-intensive, media-heavy approach; or the slow, steady, time-intensive, capital-light route. The question is, as a mid-sized business, which road should you take? Ask yourselves these questions to arrive at an answer: Do you have capital?
When clients ask me how much they should budget for marketing, my answer always is: as much as you are able—and then some. Firms such as Salesforce.com and Netsuite had SG&A costs (selling, general and administrative expenses) ranging from 50 per cent to more than 100 per cent at various points of their lives. Oracle’s costs now run around 20 per cent. How important is it to increase market share rapidly?
If your product or service relies on scale for efficiencies, then you need to invest in gaining the required market share. Or, if you feel that your offering can be copied soon, you need to capture the market share quickly. On the other hand, if your offering doesn’t need scale to be profitable, and isn’t easy to replicate, then you have the luxury of a slow increase in the market share. It’s worth mentioning here that company growth and increase in market share aren’t always linked, because the company may be growing rapidly on a small base. What is the competition doing?
A foreign entrant in the hospitality products space shook up Indian incumbents by offering its product for free. (It made its money eventually with annual maintenance fees.) In such a case, companies will have to ramp up marketing spends sharply, if they want to defend their turf. How important is the surrounding ecosystem?
You can reach a tightly-defined group of buyers with a capital-light approach. This is
highly recommended where the target audience is known and contained. But if influencers, such as the government, non-governmental organisations (NGOs) or the media, play a large role in your business, then this may not be sufficient. Take, for instance, big B2B firms such as Vedanta and Mittal Steel. They are investing in a social media strategy. Their target audience, in this case, would be NGOs, who influence the response of local landowners and farmers to land acquisition for mining or factories.
pate. This also reflects the strength of your brand. For example, if you’re an Apple loyalist, you only choose among the Apple range of products without even evaluating a Dell or Lenovo. When you have that kind of brand loyalty, it makes sense to become an end-to-end player—after all, consumers want to buy from you, and will only explore another brand if you cannot fulfil their need. Many CEOs, particularly in India, believe that “if my product is good, people will buy”. That was partly true in pre-liber-
Relying on the product alone to sell is like buying a mousetrap and deciding to skip the cheese. Still want to know what per cent of revenue should go to marketing? Well, if you’re going the slow-and-steady route and are a B2B firm, not a fast-movingconsumer-goods (FMCG) one, even 2 per cent might work—though this means you’ll have to compensate with a lot of additional time investment. You may also face a 20-year horizon to gain awareness. But, if you want rapid growth, you’re looking at anything from 20 per cent to 100 per cent, at least for the first three years. A brand investment shifts your marketing strategy from feet-on-street driven “push” to consumer “pull”. There are some simple metrics that can help you determine where you are today. What per cent of your sales are through call-ins, online forms and e-mail requests? If the answer is more than 50 per cent, then you know that you are on your way to a “pull” brand. The role of sales becomes that of guiding the customer and conversion. Another measure is the per cent of your business that is non-compete or solus, i.e., you are the only company invited to partici-
alised India, when, thanks to the License Raj, options were few and far in between. In that supply-driven scarcity environment, brand building took a back seat. But, those days are long gone. Technology, deregulation and outsourcing have lowered the entry barriers in many industries. And where there is competition, brand is your only defence against commodification. Relying on the product alone to sell is like buying a super-duper mousetrap and deciding to skip the cheese. The mouse is just not going to find the trap. If you dream of a future where prospects walk through your door wanting to buy your stuff, or, better still, where you have a backlog of orders to service, then the route you should choose is clear.
Jessie Paul is the managing director of Paul Writer, a marketing advisory firm. She is also the author of No Money Marketing. She can be reached at jessie@paulwriter.com AUGUST 2010
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INNOVATION
Companies on the Cutting Edge
A shield that saves the world
With 500 million users—and growing—India is one of the largest markets in the world for cell phones. To support this rather large crowd, service providers have put up around 4 lakh towers. Add to those the thousands of towers for television and radio—and now think of the radiation emitted from this collective whole! Radiation is a serious problem that may be overlooked by a majority of people, but not Girish Kumar. The founder of Wilcom Technologies, which specialises in antenna technology, has designed a radiation shield to absorb the microwave radiation emitted by cell phones and towers. A small portable device priced at Rs 1,499, it comprises two broadband antennas that can cover frequencies in the range of 800 MHz to 4 GHz. These antennas can absorb radiation from a number of sources, including laptops, microwave ovens, cell phones, towers and computers. Kumar and his team are also working on radiation shields for AM, FM and TV towers, and an upper band of WiMAX. Their plan for the future is to capture microwave energy and use it to power battery and mobile phones. Sales Present: 1,000 units Expected: 100,000 units
“There is so much radiation in the world. Someone needed to invent something to absorb it and prevent it from harming others.” —Dr Girish Kumar, founder, Wilcom Technologies
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Radiation Shield
Wilcom Technologies
IMAGING BY SANTOSH KUSHWAHA
REPORTED BY AKHIL BERY
BALANCING ACTS BY MEG CADOUX HIRSHBERG
To Love, Honour and Report To Working in your spouse’s company may be the toughest job you will ever have When I moved to Stonyfield
Farm in the mid-1980s to live with my then-fiancé, Gary, I immediately went to work in his yogurt business. I worked part time in the office and in sales, reporting to Gary, and part time as a yogurt-maker. At that time, the “factory” consisted of some juryrigged machines in our barn; turning out a good product required improvisation and luck. But my sales job was just as taxing, in personal ways I hadn’t anticipated. I started working for Gary for the same reasons most spouses get swept into entrepreneurial ventures: I was available, capable, and cheap. My role grew out of expediency, not because I possessed any particular skills or an abiding passion for the job. Because my future depended on the company’s success, I was certainly dedicated. But Gary and I were not equal partners living a dream of our joint creation. And so we suffered double the stress without enjoying double the personal fulfilment. Many couples meet on the job, and office anxiety follows them home. But when one spouse goes to work in the other’s company, there is no relief in railing against the boss or fantasising about going elsewhere. Even when one spouse doesn’t report to the other, the entrepreneur usually wields implicit authority— not ideal when you’re trying to sustain a marriage of equals. The work environment may reveal quirks or irritating habits in both of you that never surfaced in domestic life. The most routine operations can generate a dozen new issues a day 20
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on which you disagree. And home ceases to be a sanctuary when dinner-table conversation picks up where the afternoon huddle left off. Even the way you talk to each other is affected. Michael McMillan, an Inc. reader who works with his wife at their family-owned call centre, Answer Center America, described it to me this way: “Problems at work demand yes-or-no solutions, and there’s often no time for explanations. You need to keep emotions hidden at the office—you can’t personalise disagreements.” At home, of course, conversation, compromise, and nuances are important. Everything is personal. Making the shift, from tough and impervious at the office to ILLUSTRATION BY SURESH KUMAR
BALANCING ACTS
communicative, open, and sensitive at home, can be challenging for both spouses. For Gary and me, working together revealed aspects of our personalities that had not emerged in two years of courting. Often when he’d give me instructions on how to handle our clients or suggest travel shortcuts for business trips, he’d talk fast and skip details. He sometimes became impatient with my confusion. For my part, I personalised everything and felt hurt by his occasional abruptness. I was unable to compartmentalise—a critical skill for couples who work together. Unrealistically, I expected that we’d take the time, even during the workday, to solve problems as they arose. We were often harried and uneasy—a reasonable response to the constantly looming threat of bankruptcy. Our edginess seeped into our home environment—home being about 10 feet from the office. Sometimes after my shift in the yogurt factory, I would meet Gary back in our apartment to
often not raised. How long will the arrangement last? Is the spouse just helping out or putting his or her own aspirations indefinitely on hold? Then there’s the problem of power. Hierarchy at work is unavoidable. Someone has the final say. Established couples may find it easier to prevent those dynamics from contaminating their home lives. But when authority flows in one direction all day, it doesn’t reverse course easily. One long-married Inc. reader wrote me: “My wife is the boss at home, too. I now feel like I work for her 24 hours a day.” Often, married couples imagine they’re immune, because they know each other so well. Sometimes, though, they only think they do. When one friend of mine joined his wife in her business, he discovered that “she wasn’t just a witty, sharp-tongued, funny woman—she was actually mean and abusive. We stopped liking each other.” The couple eventually divorced.
Then there’s the problem of power. Hierarchy at work is unavoidable. Someone has the final say. make supper. Hairnetted and sweaty from the incubator, I’d fret about our endless production problems and thus further blur the faint boundary between the business and our personal lives. Sitting at the dinner table, we were in no mood to pose that sweet inquiry of the other: “Honey, how was your day?” One reason spouse-employee arrangements sometimes sour is that so little thought goes into them. New employees are interviewed to assess their skills and interests; their working conditions and responsibilities are defined up front. Spouses, by contrast, may have to alter their shapes to fit whatever hole the company needs filled. Sometimes it’s a match: The onetime accounting major takes over the books. Sometimes it’s not: I was a literature major who helped with accounts receivable. In situations like ours, subjects such as compensation, flexible hours, and titles are
On the flip side, others told me they came to respect their spouses more after observing them on the job, where they appeared better organised, more focused, or more dynamic than at home. Working with Gary, I marvelled at his creativity, and his optimism and calm in the face of disaster. There are obvious ways to avoid the pitfalls. Establish job definitions and working conditions up front. Reinforce the message to each other—and to everyone else—that you are in this together, pursuing a common goal, even if one of you plots strategy while the other restocks shelves. At home, carve out inviolate time in which office talk is verboten. Perhaps more important, ensure that the spouse receives the same appreciation and recognition due any talented, hard-working employee. “The gratitude thing is key,” said Inc. reader Ginger Molthen, who works with
her husband, Tom, in his salsa business, Pepper Dog Specialty Foods. “Otherwise, I feel like, hey, I don’t need this. We’ve both sacrificed for what he wanted.” After six months or a year, step back to evaluate the arrangement. This isn’t a performance review—it’s a relationship review, with the option of reconfiguring either spouse’s role. You may conclude you’re simply not happy working together. But that doesn’t mean you shouldn’t be together. As Michael McMillan put it, “The most important thing is to commit to saving your personal life before you save your professional life.” Some relationships thrive in the workplace, as couples share highs as well as lows and avoid the long hours of separation typical in entrepreneurial ventures. The intensity of the shared experience can strengthen their bond. They are likely to be able to sympathise with each other’s stress and the need to work evenings or answer business calls on weekends. Couples who work together can offer each other wise and informed counsel about business-related problems. But for Gary and me, those benefits weren’t worth the cost. One spring morning, two years after I joined Stonyfield, we had our last business meeting in his office. By mutual agreement, we decided I should leave the company. Our business situation at the time was dire, and when I got pregnant, I became concerned that our chronic, extreme stress would affect the baby’s health. Also, we had both learned something important: Though personally compatible, we did not work well together. We chose to protect our relationship, which had existed before the business and which we wanted to exist long after it. We smiled and embraced. I turned on my heel and walked the 10 feet back home.
Meg Cadoux Hirshberg (mhirshberg@inc.com) is married to Gary Hirshberg, president and CEO of Stonyfield Yogurt. She writes a regular column about the impact of entrepreneurial businesses on families.
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Your Business Toolbox
THE GOODS BIG IDEA
A World Free of Wires Best Wi-Fi routers for your office
A New and Improved Phone Stand
A Wi-Fi router is a boon to the modern workplace. Thanks to this device, people can move around the office without worrying about losing the network connection or internet connectivity. Impromptu meetings can be held in any room, as long as there is a hotspot nearby. Transferring data between systems over the air is very convenient. And, on a superficial level, there is at least one less set of wires to worry about tripping over. Here is our pick of the best Wi-Fi routers for your office. —Nimish Sawant The story behind the invention of the ezeStand dock for smart phones THE “AHA” MOMENT:
SMC WBR14S-N4
COURTESY COMPANY (5)
The 802.11n Ethernet router is sleek and fast. This LAN protocol has a pretty compact design with a smooth white finish to it. The LED display is dark blue, the program is easy to use, but more help and information would have helped. It’s quick to set up as well. It sports a security button, which is a welcome feature. price: Rs 2,400
DLINK DIR 615
It’s a compact 802.11n router with two antennas. It has interesting features like LAN IP based site blocking and wireless isolation. While it lacks Gigabit Ethernet and USB ports, it has everything else you’d want from a Wireless-N router. It has good throughput speed and range. An easyto-use web interface helps in easy setup. If you are looking to upgrade your network to a wireless N router and don’t need any fancy features, DIR 615 is a good buy. price: Rs 3,100
BUFFALO WZR-HPG300NH
Sturdy and useful, this Wi-Fi router is quite impressive. Its black glossy finish and unconventional dual antenna make it look attractive. It is one of the few routers that support 3G/CDMA/data card. It has built-in network-attached storage (NAS) capabilities. You can plug in a USB storage device and share it on your network and even over the internet using its web client. price: Rs 9,000
ZYXEL NBG460N
Supporting faster wireless connections over longer distances, this 802.11n router is reasonably simple to use. Security features are straightforward and users can configure things easily. Its scheduling feature that turns off the wireless connection comes in quite handy. And it offers decent-quality video streaming across rooms. price: Rs 13,000
Todd Newhouse’s employer gave him a Motorola Droid Smartphone last November. Newhouse liked the phone, but he was annoyed to discover that he had to remove it from its protective case to put it in Motorola’s stand. He set out to design something better. R&D:
In January, Newhouse, a mechanical engineer, created a computer model of an improved stand. With his boss’s approval, he sent it to a 3-D printer at the office, which produced a plastic prototype. Three weeks and six iterations later, he had a stand that could accommodate most touch-screen phones, case and all. He dubbed it the ezeStand. HITTING THE MARKET:
Newhouse hired a manufacturer to make 100 ezeStands and assembled them with his wife and kids. In February, he wrote a post about the invention in an online Droid forum and sold out in four days. Since then, Newhouse, who is still at his day job, has sold more than 1,000 stands online for US$12.99, or US$15.99 with a USB cable.—Peter Vanden Bos AUGUST 2010
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THE GOODS
Products + Services
A way to access travel documents online Losing your passport or driver’s license can turn a business trip into a travel nightmare, especially if you travel across continents. A new service called AccessMyID aims to relieve the stress by giving travellers online access to high-resolution images of their photo IDs, health insurance cards and other important documents. After signing up for a subscription—which isn’t really high for frequent international travellers—you can upload high-res images of your IDs to the service’s encrypted site. It scores over e-mailing the soft copies to your own account since most experts suggest that important documents should not be kept in an e-mail account. E-mail is not usually encrypted and is only protected by one password. If you lose the hard copies, you can log on to your account— which can be secured with up to 20 passwords—and print out the images, making it easier to get replacements. The photos won’t get you through airport security, but you can use them as proof of identity at many hotels and official buildings. cost: US$19.95 a year for 50 megabytes of space –Adam Baer
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PLATRONICS EXPLORER 240
The Explorer 240 is a much smaller unit,
set. The armature that sits behind the ear maybe bulky, but it’s lightweight. The mouthpiece is mounted on a long and sleek armature. The call accept/reject button is cleverly integrated into the mouthpiece armature and we missed it at first glance— it’s easy to use. The earpiece is soft silicone and comfortable. The volume buttons are intuitively placed, as is the power button. There’s one minor problem with the mouthpiece unit—the microphone has a honeycomb grille and, if you haven’t shaved, this keeps getting caught in the stubble! In-coming call clarity is great, voices sound clear, with no distortion. The moment a wall or door comes in your way, signal quality deteriorates badly. Priced at Rs 4,199, the Voyager Pro is for those who want an upmarket device.
with a thin plastic armature going around the ear. The ear pad is rubber with a slight protrusion that is meant to stick into your ear. The device looks nice, but the barrel itself houses the electronics which is why it isn’t as thin as the Voyager Pro, but then the armature of the Voyager Pro is several times bulkier. The earpiece on the Explorer 240 is not unanimously comfortable, some users found it easy, while others hated it since it hurt the outer ear. Therefore, it’s one of those devices that you’ll need to judge for yourself. The Explorer 240 is also a decent performer, and call clarity is good. It has the same range as the Voyager Pro, though the latter controls external noises better. Priced at Rs 2,199, it’s a good deal, but we’d rather spend more and get the Voyager Pro.
INTELLIGENCE
A new way to scour the Web What with blogs, social networks, and 24/7 news sites, finding and sorting through information about clients, competitors, and prospects on the Web can become a full-time job. A new service called Workstreamer does the job for you. You create a free account on the Workstreamer website and name companies you would like to follow. Then, the service scours a vast amount of online sources, including Facebook, Twitter, and SEC filings, for mentions of those companies; Workstreamer filters out junk like coupons. Links to the information appear in your account in real time, sorted by company, as well as in daily e-mail updates. —Peter Vanden Bos
LEFT & TOP LEFT : PHOTOS.COM
LOST AND FOUND
PLATRONICS VOYAGER PRO
The Voyager Pro is a large Bluetooth head-
Powered by:
Easy on the Ears Bluetooth headsets for the talkative
Work + Play
What’s That on Your Wall? A primer on LED television sets
THE GOODS
FIRST PERSON
At the end of a hard day at work, there’s nothing like a little bit of television to lighten
the furrowed brows. Thanks to technological advancement, we can now opt for the biggest and the best TVs. Lately, many people have been gravitating towards LED technology in search of a better picture, colour, and quality. Just in case you haven’t bought yours yet, here are four options for you to consider. —Akhil Bery
How to use Yammer, a messaging system for businesses
TIM MINER, FOUNDER VESTOR LOGIC, LAS VEGAS
SAMSUNG UA55C9000SR
With 3D capability, this is one of the slimmest sets around (33.9mm thickness). It has four HDMI slots, 1920x1080 HD resolution and 200Hz Mobile Plus technology. Its picture sharpness and 15Wx2 speakers, combined with the possibility of convert ing 2D movies to 3D, make it one of the best options. price: Rs 429,000 to Rs 440,000
TOSHIBA XL700 SERIES
Launched in mid-July, the XL700 Series is Toshiba’s entry into the Indian market. The series is equipped with an auto signal booster, compensating for a weak signal; auto view, which utilises a built-in ambient light sensor to adjust picture parameters; and technology that elevates images to HD quality. price: Rs 1,20,000 to Rs 2,30,000
SONY BRAVIA 52 NX800
Using LED technology, Sony has converted the NX800 series into the most powerefficient television around. It comes with eco-friendly power features, ensuring that the television consumes 63 watts while the picture is on, as against a popular rival’s usage of 78 watts. Its ultra sleek design makes it even more attractive. price: Rs 2,49,900
TUNES
COURTESY COMPANY
Singing in the rain The Sony Walkman W250 can survive a rainsoaked run, or a rinse in the sink. Unlike most water-resistant MP3 players, this one is cord free. The device, which has a player with 1.68GB of storage built into the headset, has an adjustable band that wraps around the back of the head and curves over the ears. It comes with earbuds in three sizes. You can shuffle songs, move forward or backward by turning a dial on the earpiece, and scan selections by playing only main melodies. Three minutes of charging gives you enough juice to play 90 minutes of music; a full 90-minute charge lasts 11 hours. cost: US$59.95 —John Brandon
I started using Yammer, a free Twitter-like messaging system for businesses, last year. I consider it as my social media company’s private Twitter feed. When I post a comment, colleagues can comment on it and attach files. I often need to go back and access a point in a conversation, which is easier to do on Yammer than in an e-mail chain. We use Yammer to archive information as well. During presentations, we assign each client a hash tag, just as you would on Twitter. As we collect documents, we attach them to comments containing the appropriate tag. Then, we review all items in single place to build a better presentation. We also use tags to archive relevant information about our industry and to flag comments for further discussion. One of the best things about Yammer is the fact that I can access it from anywhere. When I’m vacationing, I can log in to my Yammer account to view files. I also use the Yammer app on my BlackBerry. For instance, I recently overhead an interesting observation about Facebook at the airport. I shared it with my staff at the drop of a hat. —As told to JJ McCorvey Does your company sell a new product with an interesting backstory? Tell us about it at editor@incindia.in AUGUST 2010
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THE GOODS
Beyond Business
Things I Cannot Live Without Trek 7.1
My wedding ring
A recent buy, this up-scale bicycle is my main transport to office. It helps me cut down on my carbon footprint and focus on defensive driving tactics.
A week back, I had forgotten to wear my ring. I remember coming back home just to pick it up.
My to-do list I love making to-do lists; either on my mobile, laptop, or I sync.
CEO, REDBUS.IN
Phanindra Sama
Reading business books I am reading Influencer by Kerry Patterson. The book focuses on fundamentals that help tap and influence cultural changes.
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His name means the “king of gods”. Phanindra Sama may not rule celestial bodies, but he does hold sway over the world of e-ticketing for buses. An engineer, Sama believes that green technology is the key to the future. Even when he travels for work, he does so responsibly— cycling to his office every day, even in the nightmarish traffic of Bengaluru. He hopes to spread the culture of “defensive cycling” among others at work as well. Other than his healthy habits, the 28-year-old is addicted to news. To keep himself in the loop, he resorts to blogs and RSS feeds. When he is not reading, he’s consulting his to-do list. “I prefer to finish three things properly, than do five haphazardly,” he says. His latest obsession, an “eco-house” for his queen. Amen to that.—Sunaina Sehgal
...and What I Covet Green home A house built entirely on renewable energy, with a sprawling lawn and a veggie patch for growing organic greens and fruits.
PHOTOGRAPHS BY S RADHAKRISHNA
UNITED COLOURS
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ENTREPRENE U 28
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URSHIP
Welcome to the new, new India—the land of opportunities. The business of business is tough here. With its array of cultures, habits, tongues, and small matters of sense and sensibilities, boy, it gets tougher, if you don’t talk the talk, or walk the walk. But, the ‘buzz’ around this booming economy has lured men and women of all shades and races to start up on its shores. Here are a few tales of brave foreigners, who have responded to the magic that’s India— shrugging off the ‘small’ matter of language, and making a place in their hearts for this country.
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Recipe for Success Lalita van Lamsweerde decided to offer bagels after researching the eating habits of Indians.
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PHOTOGRAPH BY VIJAY KUTTY
THE EXPAT CLUB OF COMMERCE
FOOD COMPANY
Bagel’s Cafe Serving authentic fare and flavour Lalita de Goederen van Lamsweerde first visited India in 1985 as a six-year-old. Her father, who had studied Indian classical music and dance, organised shows on Indian music in the Netherlands. She stayed for four months, while her father looked for talented musicians for shows back home. She came back a few years later as a college student. “I took off a trimester from the university and decided to explore India on my own,” she recounts of her visit to south India. And, years later, it was this connection with India that weighed heavily on her mind when her husband, Alexander, and she decided to relocate to another country. “We always knew we wanted to live in a new country for a few years of our life, preferably somewhere
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that people did not flock to. So, we homed in on India and China,” recalls Lamsweerde, who was then working as a public relations (PR) professional in Holland. Her husband, a banker, had never been outside the European continent. So they toured the two countries to check out their options. Once back home, they settled on India and called a recruiter to find jobs in India—in real estate for Alexander and in PR for herself. There on, things fell into place, almost magically, she says. Her husband found a job with an international real estate firm in India. And, even though she didn’t have a job, they moved to India in 2008. But even before she landed here, Lamsweerde decided that she had had enough working for other people. “It felt like a
BAGEL’S CA FE
FOUNDER: Lalita van Lamsweerde AGE: 31 LOCATION: Gurgaon YEAR OF FOUNDING: November 2008 LATEST TURNOVER: Rs 6 lakh per month NUMBER OF EMPLOYEES: 18 FUNDING PUT: Rs 40 lakh BREAK EVEN PERIOD: Eight months BIGGEST EXPENSE: Construction QUALIFICATIONS: Masters in Communications from the University of Amsterdam, Netherlands RED TAPE FACED: Getting electricity and water supply, property
rentals and un-cooperative, lazy construction workers BEST PART OF DOING BUSINESS IN INDIA: It’s great to be a part of such a vibrant economy. And, everything is possible here at any time you need it WORST PART OF DOING BUSINESS IN INDIA: People think they can ask foreigners a higher price for a product or service than they would ask an Indian
new beginning. I was not thirty yet, we had no financial constraints, or children, and we had moved to a new country. I wanted to start my own company,” she adds. She only knew one thing— her passion for food. “I loved cooking and eating,” says the hostess of numerous dinner parties. So, she decided her business had to do with food. She spent the better part of the first year in India re-connecting with people she knew in the hotel industry. They gave her insightful information about the food market and business laws involved. After much thought, Lamsweerde decided to get the humble bagel to town. The ring-sized bread, hugely popular across Europe and America, was not commonly found in the city. Her research had also revealed the changing eating habits of Indians and the growing importance of bread on their tables. Convinced that the bagel would turn taste buds in its favour, Lamsweerde opened the Bagel’s Café in June 2009. A cheery and warm twostoried place, it’s a cross between an easy-going lounge and a fine-dining restaurant. It has been received well so far, with crowds steadily pouring in to try out fresh bagels and mouth-watering Stroopwafel cookies. The interesting items on the menu make for a great cosy breakfast or a lazy brunch.
Despite numerous suggestions left by customers to add paneer, the Indian cottage cheese, to her bagels, and the temptation to throw in a few items that would resonate with the Indian crowd, Lamsweerde has refused to go down that way. “My vision is to offer pure continental flavours, to make bagels the way they have been made over the years. And that’s why they are so great,” she adds. Though the sweet-smelling bakery might make the job of an entrepreneurial baker look easy, the road from penning the concept to conceptualising has often been a harrowing one, says Lamsweerde, whose cafe is situated in Gurgaon’s posh DLF Phase-1 shopping mall. “Had I known more about construction work and time lines that come with it, the same place would have cost me so much lesser,” says the Dutch, who built the 900-sq-feet cafe from scratch. Her entrepreneurial success story has been picked up by the press back home, triggering a slew of curious calls from Dutch venture capitalists. The funds sure could come in handy for Lamsweerde who has plans to open six to eight more cafés in south Delhi in another two years. No mean feat for a PR professional whose entrepreneurial instinct got fired by the bustling chaos of an Indian airport. — Sunaina Sehgal AUGUST 2010
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The Golden Egg Roger Langbour spent two years on a farm in France before running one on his own.
POULTRY COMPANY
The French Farms
A few kilometres outside Delhi, off the highway leading to Jaipur, is The French Farms, a little green island that stands out amidst the vast rural landscape. Visitors to the farm are greeted with a warm smile—and workers donning at least one piece of clothing that makes them look, undeniably, a tad bit French. Even their mannerisms are different, and certainly unexpected, from an average Indian farmhand. The lawns are manicured, and pathways brick-laid. To the right side of the drive-way is a duck pen. At the end of the path are two of his three Rottweiler dogs, standing guard. In fact, everything on the farm bears such a resemblance to the European countryside that you might even think you were somewhere there. It seems that is exactly what its founder, Roger Langbour, had in mind when he built the eponymously-titled French Farms—a piece of land that would be a picture of his own country. There are pig pens that are as spic and span as schoolyards, green patches that pro32
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duce vegetables that are usually found only at elite grocery stores in upmarket neighbourhoods, and workers who carry themselves with a sense of dignified humility that is not seen on domestic farms. This little Isle de France is about 20 years old now. Langbour, who first moved to India in the mid-70s to serve in the French embassy, didn’t want to leave the country after he left his job in 1991. Then Langbour had an idea. During his long stay in the country, he had found it difficult to put good quality meat on his dining table. He still winces at the mention of the local meat market. “Have you been to INA market! It is filthy, and it has been like that for as long as I can remember,” he says. So, he decided that things need not remain that way. If he could simply devise a way to manufacture the food products he loved, he might even find people who would want to buy them. And that is what he has done in the past two decades—fabricating an Indian version of the elite variety found back in France.
COURTESY COMPANY
Putting exotic products on Indian tables
THE EXPAT CLUB OF COMMERCE
Before setting up a farm, Langbour went back to the French countryside to work on a farm and learn the techniques he would need to set up on his own. Despite being past his retirement age, Langbour laboured on the farms for two solid years like any other farmhand, ploughing fields, milking cows and, of course, tending to the ducks and pigs. In exchange, he gleaned as much as he could about their farming techniques, ate at their table and had a room of his own. He flew back to India—and his Bengali wife—with this new inventory of skill sets. With the help of a friend, he bought three acres of land outside Gurgaon, a suburb of Delhi, and started out rearing Peking ducks. By the summer of 1994, he had made his first sale to the Hyatt Regency. French Farms had officially opened its gates. Today, the farm offers an assortment of ducks, quails, rainbow chickens, turkeys, pigs, guinea fowls and a whole range of vegetables. The rise of French Farms, however, has been far from meteoric. Langbour has just about touched Rs 1 crore in turnover this year. Throughout his journey, he says, he has encountered the obstacles commonly faced by a small business owner, as well as the realities of dealing with workers, competition and government bodies of a developing country. The shortage of electricity irks him, as well as the fact that industrial areas are given preference over agricultural areas. Electricity keeps his motors pumping water and also keeps thousands of young quails warm. “Electricity supply was better 15 years ago. Anywhere else in the world there would be a revolution because of this shortage,” he says, continuing, “it is also sad that the government doesn’t encourage organic farming. I haven’t used pesticides for 15 years.” His aversion to pesticides, though ignored by the government, hasn’t escaped the eyes of his elite clientele who are ever delighted to find good meat products with an organic label. French Farms is now reputed for its légumes organiques. Though the high-end price tag ensures the products remain only in the niche market, there is certainly no dearth of buyers. His clients include the growing expat community in the NCR region, and wealthy Indians, such as the Maharaja of Holkar and journalist-turned-media-tycoon, Prannoy Roy, he says. A delivery van traverses the NCR region thrice a week, dropping off meat and vegetables to households that have placed orders two days in
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THE FRENCH FARMS
FOUNDER: Roger Langbour AGE: 68 LOCATION: Bilaspur, Gurgaon YEAR OF FOUNDING: 1994 LATEST TURNOVER: Rs 1 crore NUMBER OF EMPLOYEES: 30-36 FUNDING PUT: Rs 20 lakh BIGGEST EXPENSE: Building and maintaining the farm; daily cost of using five generators RED TAPE FACED: Apathy towards agriculturists from the government BEST PART OF DOING BUSINESS IN INDIA: Compared to France, starting a business in India is easy WORST PART OF DOING BUSINESS IN INDIA: The government doesn’t encourage or invest in peoples’ entrepreneurial spirits. Industrialists are considered businessmen and agriculturists are considered nothing
advance. He also delivers to select commercial establishments— like Neemrana Hotels, Mrs Kaur’s and Ritu Dalmia’s Diva. The rest, he says, can deal with his distributor. And this includes Indian five-star hotels, which, complains Langbour, “want international quality at local prices” and “constantly haggled for better rates and never paid on time”. Things are better now with a distributor in the middle. “I just deliver meat and collect the payment. I don’t have to chase the management of different hotels,” he says. Along the way, he has met several people who have offered to plug in to his project. Others have offered to buy him out, if he just remained in charge. But Langbour has turned down all of them, to remain his own master. Now in his late sixties, he’s still thinking of ways to take his business forward. His interests are shifting to a new product— mushrooms—which he wants to grow the green way. “When it comes to spotting opportunities, you have to feel them. You need to forecast what people are headed towards,” says Langbour. This tastemaker clearly knows that if he has to find a sustainable niche, he needs more than a just a replica of a product—he needs great quality more than anything. —Jacob Cherian and Sunaina Sehgal
BEAUTY COMPANY
S2 Spa Giving a makeover to the cosmetic industry For someone who started out as a television journalist, Philippines-born Ema Trinidad has certainly written an interesting story for herself. After spending five years in broadcast journalism, she had an epiphany. In 1999, after much research, she started distributing anti-ageing skincare products in her native place. The business had attracted her for three reasons. It suited her well since she could run the business alongside a job. It required hardly any capital or overheads. And, it AUGUST 2010
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dad came to India to find distributors for her anti-ageing products. But as she hopscotched across the country, her plans changed. Everywhere she went, Trinidad found a ready audience, eager to see a demo of her products. A blob of the beauty potion would be smeared on one side of the volunteer’s face as contrast to the other untreated part. “The change
would blow them away,” recalls Trinidad. That’s when she starting toying with the idea of starting a salon-cum-spa in India. She found a partner in a non-resident Indian from the Philippines and Armaan Kara, from Mumbai. Together, they zeroed in on Bengaluru to start S2 Spa.
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helped that the beauty industry was recession-proof. Her research indicated that the future lay in anti-ageing treatments. Only, her native country proved too small for her ambitions. Soon, the mother-of-three was training her firepower across borders. “Singapore was my first training ground,” she says. Malaysia and other Asian countries followed soon afterwards. Then, three years ago, Trini-
Best Face Forward Ema Trinidad came to find distributors for her products, but stayed on to run her own spa.
“Most of my partner’s family and contacts were here, so this seemed like the best place to start out from,” she explains. The timing worked perfectly in her favour. The rising economic power of the middle class ensured that there was enough money in the wallets to splurge on treatments that promised a healthy ruddy glow. The influences of Bollywood and other media channels had made people, especially women, more conscious than ever about their looks. “I realised that women in India were looking for something more than what they were getting from their little salons, something more resultoriented,” she adds. Soon Trinidad had found her own space in the beauty industry, sandwiched somewhere between the steeply priced five-star hotel spas and the cheap neighbourhood beauty parlour, “where everything is done to you, but hygiene is an issue”. “I offered my clients the feel of a five-star spa at half its price. I am more expensive than your typical salon, but my services are more personalised.” Bengaluru is only the first stop in Trinidad’s scheme of things. “I am looking at opening outlets in the entire country, otherwise this wouldn’t be worth my time,” she adds. Her second outlet in the city is due to open shortly. And, she’s in the process of finalising a deal with a chain of hotels to operate her spa in its properties all over the country. “That will make my expansion better and easier,” she feels. Trinidad also plans to open her “facials-only” format in malls and go the franchising
THE EXPAT CLUB OF COMMERCE
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S2 SPA
FOUNDERS’ NAME: Ema Trinidad and Armaan Kara AGES: 38, 36 QUALIFICATIONS: An international skincare specialist with 12 years of experience in the industry LOCATION: Bengaluru YEAR OF FOUNDING: 2008 NUMBER OF EMPLOYEES: 12 FUNDING PUT: Rs 1 crore START-UP COSTS: Rs 80 lakh BREAKEVEN PERIOD: Four years to five years BIGGEST EXPENSE: Renovation and interiors RED TAPE FACED: Licences and departmental approvals BEST PART OF DOING BUSINESS IN INDIA: There are so many people, if my product even taps 10 per cent of the market, I will make a fortune THE WORST PART ABOUT DOING BUSINESS IN INDIA: You struggle every step of the way. No respect for the value of time. People don’t honour their word. Professionalism among employees
way. That’s not all. “I have a list of possible businesses in India because every inconvenience and discomfort I encounter here is an opportunity for a business,” she laughs. If India has smiled on her products, it has also been a place where starting up has meant a whole lot of frowns. “I thought I’ll finish renovating the building in two months. It took us 15 months to complete the renovations; and, we were paying rent all that time,” says Trinidad of practical problems. She and her partners had to struggle for “everything”— from getting the registration for the company to dealing with suppliers. “I had to run after the suppliers instead of them pursuing my business,” she says, exasperatedly. Moreover, “deadlines are mere suggestions; you cannot rely on them. I wasn’t used to this, or prepared for it,” she says. She’s amazed that a country like India still lacks the most basic infrastructure, such as power. “I didn’t know power shortage would be so acute and that there will be no definite solution. Right now, I am planning to expand. I want to align my plans with the government’s, because I cannot open 10 branches in Bengaluru and
struggle with each one the way I did with my first,” she says. The employee front is another area in which Trinidad is reinventing the wheel. “There is a lack of work ethics, which is frustrating sometimes. So, I am educating them and introducing concepts like excellence, not being satisfied with mediocrity, honesty, punctuality and integrity.” Despite all the challenges, recalls Trinidad, the day “we finally lit my signage outside the spa, I felt like crying because I had taken an idea and brought it to a tangible form”. Cut to today, Trinidad regularly follows Bollywood movies, eats Indian food and watches cricket, so that she can relate to her clients. While she lives in Bengaluru with her two daughters, aged 13 and 8, her husband and elder daughter live in the Philippines. “I am financially and emotionally committed to India through my business,” she says firmly. “If you are looking to build a business that you can pass on to your children’s children’s children, then India is the place for it.” Not bad for a person who was looking at hold on to just a part-time career. —Pooja Kothari
Darren Odell Discovering the real India For decades, images of Rajasthan, showcasing its majestic palaces and sand dunes, have personified India abroad. Few foreign tourists would risk forgoing this must-do India. Yet, Darren Odell, a 42-yearold British professional from the travel industry, feels that the “real” Rajasthan, including its tourist-infested capital, Jaipur, is incredibly undiscovered. It’s a gap he’s hoping to fill with Virasat Journeys, a boutique travel company. Founded in April 2010 as a partnership between Odell and Vipul Bansal, a Jaipurbased hotelier, Virasat offers tourists offthe-grid travel experiences. “People want more authentic and interactive holidays,” says Odell. Their first “product”, as Odell calls it, was Old Jaipur Walking Tours developed using research from the Jaipur Virasat Foundation. The two tours conducted—Temples and Havelis of Old Jaipur and Bazaars, Cuisines and Crafts of Old Jaipur—small groups of up to six people walk through the busy by lanes of the city. They interact with resident artisans, shop owners, temple priests and residents. In the past three months, Virasat has conducted more than half-a-dozen walking tours, priced at US$25 per person for a twohour expedition. Odell knows that they have taken very small steps, but he is brimming with ideas. “We can’t divulge all our products. But, there are going to be rural home stays, holidays that help tourists work with NGOs, and much more.” He’s also ticketing numbers. “Even if we generate 36 bookings a day, and six walking tours, that’s £5,000 a week.” He forecasts a soft launch of all their products in September, and is hoping to get upwards of 15 people a day for just the walking tours by December, when the tourist season peaks. “Some big tourist companies have encouraged us,” adds Odell He confesses he’s anxious about the big move to start up in India. But, adds optimistically, “I don’t think I will be renewing the rent lease on my house in the UK.” For now, clearly, Jaipur’s old bazaars are home. —Shreyasi Singh AUGUST 2010
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ADVENTURE SPORTS COMPANY
High in the Sky Richard McCallum (right) and Jonathan Walters hope to see their adventure sports tours climb a higher ground.
Sitting in his ground floor office housed in a typical south Delhi bungalow, Richard McCallum sheepishly admits that he still wonders, as often as “this morning, last night, the week before”, about what the heck he was doing in India. But wait, isn’t he the co-founder of an adventure sports startup, which provides adrenaline-pumping rides over the Aravallis? As if by practice, his partner, Jonathan Walter, rattles off the requisite answers, or rather the reasons. “You have to have faith in the bigger picture,” he advises. “New things are being tried out every day and there is a great buzz. The market just keeps getting bigger,” he adds calmly. keting job with Cathay Pacific’s India office to set up Flying Fox. McCallum nods his head, suddenly shaken out of his reverie. He first came to India on holiday in 2001, and knew instinctively This soul-searching is probably a manifestation of the peaks and that he had to spend some years here. “Adventure tourism seemed valleys of an entrepreneurial life in India; the exhilarating part of to be the perfect reason. We realised it was bound to be a huge starting up in a developing economy and the hitches that almost growth area,” he adds. threaten to clog the excitement. He met Walter, who came to India in late 2004 to work for the In November 2007, the two British men founded Flying Fox— International Red Cross’ tsunami rehabilitation work, in 2005. Both India’s first adventure sports company offering zip tours—a shared entrepreneurial ambitions and a strong intuition that India unique, aerial journey, where you fly down a series of ultra-strong cables, called zip lines, attached by just a harness and pulley. Flying had “fantastic” potential for world-class products and services. It Fox offers two tours, at the made sense to co-navigate. Neemrana Fort Palace and “Dickie (Richard) had Jodhupur’s Mehrangarh Fort. many, many ideas. I just had Company Dashboard FLYING FOX Since it began operations in one, zipping,” explains 42-yearJanuary 2009, more than 6,000 old Walter. FOUNDERS: Richard McCallum and Jonathan Walter AGE: 32, 42 LOCATION: Delhi YEAR OF FOUNDING: people have braved the ride, So, the duo pooled in Rs 60 2007 LATEST TURNOVER: Rs 1 crore NUMBER OF with almost 5,000 customers at lakh and began scouting for EMPLOYEES: 18 FUNDING PUT: Rs 1.5 crore START Neemrana itself! McCallum locations, the game-changer for UP COSTS: Rs 60 lakh BREAKEVEN PERIOD: Not yet and Walter, however, aren’t suran experiential activity like BIGGEST EXPENSE: Building the courses; importing prised that the tours took flight. this. “You can’t zip in a parking safety equipment from France RED TAPE FACED: Registering the company took eight months WORST “By then, I had lived in lot, can you?” laughs Walter. He PART OF DOING BUSINESS IN INDIA: The nuts and Delhi for two years, and knew admits that they had some bolts of running a business here are great. The level there was a lack of interesting lucky breaks right off the bat. “I of business compliance is far greater than in activities to do,” says McCalhad spent my honeymoon in European countries. There is high entry barrier to entrepreneurship lum, 32, who ditched his marNeemrana in 1999, and had 36
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COURTESY COMPANY
Flying Fox Introducing adrenaline addicts in India to their first zip tours
THE EXPAT CLUB OF COMMERCE
made friends with Aman Nath. When we asked him for site recommendations, he just said, ‘do it in Neemrana’.” Together, the duo has poured Rs 1.5 crore in the company so far. “We wanted to lay about 10 courses in five years. But we have done just three in three years,” McCallum confesses. “Money will only start coming in once there are more sites. How quickly we can ramp up is key. It’s all about scale in this business,” he adds.
And then again, he reminds you, when you are a foreigner, the growth of your company is intimately linked to how fast you can get through India’s indecipherable and often “agonising” bureaucracy. “So much time here is spent on things other than growing the business,” rues Walter. “Since there is no adventure sports culture in India, we have to bring in a lot of trained guides from Europe. Getting visas for them has been absolutely maddening,” he complains, shaking his head. “And, it’s getting worse. Agencies don’t seem to understand start-ups. For them, an expatriate worker is only somebody who earns Rs 3 lakh each month at a multinational.” He, however, quickly adds that the “breathtakingly” good feedback from his clients makes it worthwhile to put up with “all the traffic, the weather and the pollution”. Also in the pipeline are plans to take Flying Fox to its fourth destination, a summer hill resort, probably. Rishikesh is high on the wish list too. “It’s the hub of adventure sports in India. Just picture zipping over the Ganges,” Jonathan urges. He even has a marketing mantra in place, a holy zip with your holy dip! As an entrepreneurial adventure, that should finally put to rest McCallum’s momentarily restless queries about his life in the subcontinent. —Shreyasi Singh
CLOTHING COMPANY
Masala Tee A hip product for the high-end users
Few founders personify their brand as effortlessly as Sheikha Mattar-Jacob and Noelline Besson of Masala Tee, a Delhibased luxury fashion brand. Besson, born in India, was adopted and brought up by a family in France. Mattar-Jacob, born in Singapore and married to a French architect, has lived in Delhi, Shanghai and Paris in the past five years. And it is this delightful concoction of cross-cultural flavours, experiences and influences that the two AUGUST 2010
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THE EXPAT CLUB OF COMMERCE
women are brewing to perfection with their year-old company, Masala Tee. Cannily crafted and packaged, Masala Tee works on a simple model. Using 100 per cent organic cotton, Besson and Mattar-Jacob design T-shirts that display images symbolic of India and play off the country’s culture with a smart combo of homophones like “tea” and “tee” (for T-shirt). Take, for instance, their launch collection for women. It featured form-fitted T-shirts displaying screen-printed faces of Indian women decked up with maang tikkas, neckpieces, nose rings and jhumkas in
Swarovski crystals. The Indian connection has clicked instantly with a growing band of high-end foreign tourists. To add to the uniqueness factor, the founders have even added a little story to the silk. So each T-shirt captures an Indian woman with a real name. “That’s Sapna,” says Besson, pointing to a mustard T-shirt. There’s also Divya, Piya, Sitaara and Maya. “They are part of our family now. So many people tell us, ‘oh! she looks like someone we know’,” adds Besson, who has been in India for more than five years now, doing graphic design and interior projects.
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MASALA TEE
FOUNDERS: Sheikha Mattar-Jacob and Noelline Besson LOCATION: Delhi YEAR OF FOUNDING: June 2009 LATEST TURNOVER: NA START-UP COSTS: Rs 6-7 lakh approximately BREAK EVEN PERIOD: 10 months BIGGEST EXPENSE: Production of T-shirts; two heavy-duty Macbook Pros RED TAPE FACED: Registering the company as a partnership was difficult. Paperwork took long BEST PART OF DOING BUSINESS IN INDIA: India is raw and beautiful.
As creative people, we find it so easy to get inspired here. So many things you can pick up and refine WORST PART OF DOING BUSINESS IN INDIA: Deadlines are not respected. That’s been hard to get used to
It was a chance meeting at the Delhi Zoo in September 2008 that brought the “TEE Wallahs” together. The fit was instant, and perfect, thanks to complementary personalities and skill sets. Besson, a design graduate from one of France’s leading schools of art, and Mattar-Jacob, an advertising and branding professional with over 15 years of experience with agencies like Saatchi & Saatchi, knew, almost instantly, that they could craft a successful story together. Things rolled very quickly, they say. “Even as we were getting the paperwork done, we were working on the styling,” says Besson. The founders make it clear that it was never about “two giggly girls” wanting to have some fun. “We started with a business plan and a marketing strategy. We know how we want to evolve,” adds Mattar-Jacob confidently. Since June 2009, when they
launched Masala Tee, they have made more than 8,000 pieces. Priced at a hefty Rs 2,500, these T-shirts are retailed through 18 upmarket outlets across India like Ogaan, Bombay Electric, and several five star hotels. “It’s aimed at the uppity fashionista—somebody with a high disposable income. We are focused on the niche market. And, the response has been incredible,” Besson says. Little flourishes add to the buying experience, like the clever play on “tee” and “tea”, which has been blended smartly into the packaging of the product. Each T-shirt is packed in its individual tea bag, which is either a modern silver foil packet or a soft muslin tea package of yore. Earlier this year, the duo also launched exclusive lines for men and children. The children’s collection shows stylised images of quintessentially Indian animals—cows, camels and elephants—wearing headbands and sunglasses. The “Tee Wallahs” find such inventiveness easy to come by in India. “This is such an inter-
A Cup of ‘Tee’
Sheikha Mattar-Jacob and Noelline Besson are spicing up the casual design segment.
PHOTOGRAPH BY VIJAY KUTTY
esting country to be in,” begins Mattar-Jacob, adding that she and her husband, Cyril Jacob, began itching for the excitement of a developing country in the one year they spent in Paris. “India is exciting because it is evolving. You can add your two bits to this creative energy and leave your mark on this churn.” Of course, everything has not been smooth. The company still faces long odds on the production side. “It’s proved to be the biggest hassle so far,” confesses Besson. “Because ours is a high-end product, we are very particular about the detailing. That’s been tough to manage with our suppliers,” she continues, adding that they work with two production units, one in Delhi and another in the South to ensure they don’t get stuck. “We would love to have our own production unit, to be completely in control but that is a far, far unlikely dream,” Mattar-Jacob sighs. The founders are readying to launch an e-boutique by September to enable people to buy Masala Tees online. The new platform is expected to allow them to make the leap into the international market. Having broken even within the first ten months, courtesy viral marketing, the TEE Wallahs are now looking at tripling production over the next year. They already retail out of boutiques in Mauritius, Dubai, Singapore and France. “There is such a buzz about India around the world. We get a lot of queries from abroad. But, we want to do it right, to make sure we hit at the right target audience at the right time,” they say. Clearly, this duo knows the perfect blend of masala for their tee. —Shreyasi Singh
Shoba Purushothaman Preparing for global careers When Shoba Purushothaman, a Malaysian, had to choose a location for her next innings as an entrepreneur, she chose India. Having built three successful businesses in the West, she and her British business partner settled in Mumbai to start a company in the education sector. Their second venture, The NewsMarket, is a New York-based broadcast news distribution service. While heading that company till a few years ago, Purushothaman had to deal a lot with India since her technological platform was being developed here. “Each time we came here, India became more compelling as a location to start a business,” she says. She’s equally excited about being in India personally. “It’s great to be a part of this moment in history when there is so much social change going on here,” adds the veteran businessperson. Her partner, Anthony Hayward, and she plan to incorporate their company and get an office in the coming months. “We’ll start in Chennai , Pune or Bengaluru, and spend time in tier-II and tier-III cities,” she adds.
Their interest in training comes from the huge experience in hiring quality talent for their earlier business. Having hired young graduates, they feel that “the higher education system doesn’t necessarily prepare people for operating in the global market place”. Given that the world’s becoming flatter, it’s a skill that young graduates are likely to need more than ever. There’s also a personal interest in the education sector. At present, Purushothaman is looking for options that can make a difference to society, more than her personal wealth. “I’m not a non-profit kind of person, but at this stage in life, I’m interested in doing something that leaves an impact. This is one of the few sectors in which, we believe, we can make money and make a difference to society.” Purushothaman and Hayward hope to train people with diplomas and degrees in some of the non-traditional, but attractive, career paths that India’s going to be confronted with. “India is different enough to be exciting and familiar enough to be comfortable,” she has the final say. —Pooja Kothari
TRAVEL COMPANY
Shanti Travel Variety of India packaged in made-to-fit tours
Alex Le Beuan has had an extraordinary Indian journey. Since January 2005, when he founded Shanti Travel, a custom travel company in Delhi, his business has grown to 80 employees, three offices in Delhi, Pondicherry and Leh, and an impressive Rs 13 crore. The success sits easy on him. “Yes, we have done well, and are still growing fast,” he says from Sri Lanka, where he is putting final touches to some “promising” business alliances. AUGUST 2010
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It’s almost as if Le Beuan had been preparing for this moment for much of his life. As a student at Inalco, a prestigious institute offering courses in Oriental languages and civilisations in Paris, Le Beuan’s imagination regularly took flight to exotic, foreign cultures. “I first came to India after high school. The mighty Himalayas captured me for life,” recalls the 35-year-old, who worked as a tour guide in India for eight months before returning to France to earn his college degree. Even though he returned to his native land, the sojourn into the eastern lands remained in his mind. In college, he often bunked classes, for weeks at times, to accompany tour groups to India and Nepal. Before long, he earned his graduation degree in Hindi and the Indian civilization, and became a middle-mountain guide. From 1998, he spent six months every year as a trekking guide in Rajasthan, Ladakh and Himachal Pradesh. In 2002, he joined a French tour operator in Paris as a production manager in charge of Asia, and notched up frequent flier miles to the Indian subcontinent. Moving to India almost seemed the logical next step. Once in India in 2004, Le Beuan ran a 17-room hotel with an Indian friend in west Delhi, but they dissolved the partnership after a year so that he could focus on his travel bug. “I didn’t want to start just another travel company,” he explains. “First, I wanted to talk directly to my customers, not have them meet sales representatives in Europe. So, we became e-operators, and got people directly to our website,” he says. Second, Le Beuan wanted to offer flexibility. While working in France, he had seen that more and more people wanted to travel by themselves instead of being bunched up with big groups of cotravellers. “So we offered customised, tailor-made tours,” he adds. It’s a strategy that has worked in his favour. Just last year, Shanti Travel organised 2,500 itineraries, and has planned tours for more than 5,000 people since it started. “Being online allows us to offer rates that are often 35 per cent cheaper than what our customers would manage in Europe,” says Alex. Travellers choose between fixed package tours, à la carte holidays and tailor-made itineraries for a gamut of holiday options across the hidden treasures of the Indian subcontinent. Next year, Shanti Travel plans to open its fourth office in Kochi.
“The South circuit is buzzing off late. Both Karnataka and Tamil Nadu are growing fast,” says Le Beuan. It’s what makes a travel business so exciting in India. “Few countries can compare with such variety,” he adds. Although French tourists form the chunk of his clientele, the company gets a truly mixed bunch, mostly from countries like Germany, Italy, Spain, Belgium and Switzerland. Catering effectively to such a diverse group of preferences is at the core of the business; therefore, Shanti Travel has a sizeable expatriate workforce, going well over 25 per cent. “Such an arrangement helps us understand the needs of our customers and serve them better,” explains Le Beuan. There are advantages to gain from this combination, too. “In metros like Mumbai, Delhi and Chennai, hotels and travel professionals prefer to work with us because they know we’ll be professional and won’t delay payments,” points out Le Beuan. Shanti Travel’s other two directors, Caroline Humbert and Jeremy Grasset, are also both French. They became partners in October 2007, and jointly own 50 per cent of the company. Le Beuan, the largest stakeholder, owns the remaining half. Getting them on board has been the game changer for Shanti Travel, Le Beuan believes, as he recounts the initial struggles of creating a company in India. “I could not have survived alone,” he confesses. —Shreyasi Singh
SHANTI TRAVEL
FOUNDER: Alex Le Beuan AGE: 35 LOCATION: Delhi YEAR OF FOUNDING: 2005 LATEST TURNOVER: Rs 13 crore NUMBER OF EMPLOYEES: 80 FUNDING PUT: €6,000 START-UP COSTS: €6,000 BREAKEVEN PERIOD: Within the first year BEST PART OF DOING BUSINESS IN INDIA: The diversity of the country, especially for a travel business is incredible. You can go across India 15 times and still discover new things. There is no off-season. We have tours during monsoon also to the Northeast and Kerala WORST PART OF DOING BUSINESS IN INDIA: People don’t take you seriously as a business person because you are a foreigner. Seeking meetings with
government officials can be tough. It’s a problem I have faced many times
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COURTESY COMPANY
Company Dashboard
Flight of Fantasy Alex Le Beuan’s craving for all things exotic was satiated through his tour company.
GAMING COMPANY
Kreeda Games Gambling on a billion people’s addiction to online gaming
COURTESY COMPANY
Playful Onslaught Quentin Staes-Polet loves to see the marriage of art and technology in the gaming world.
Quentin Staes-Polet had been visiting India for 16 years before he decided to put down roots in this country in 2006. His decision was dictated as much by his heart as by his head. “I met somebody in India with whom I wanted to spend the rest of my life. And, I have always loved this country because of its vibrant business environment,” he explains. Born in Belgium, StaesPolet had moved out of the
country after his college. It was hardly a place for a young, ambitious young man in those days, anyways, he recalls. The oil crisis of the seventies had left huge economic uncertainty and unemployment in its wake. And compared to that, the rest of the world, especially emerging markets like China, seemed so much more exciting to him. Since then, he has lived in Asia, working in the media and entertainment industry for
most part. His first innings was in Hong Kong, where he spent eight years as part of its music industry. “The environment and its surrounding eco-system supported innovation, creativity and ideas,” he recalls of his time in Hong Kong. The scene, however, changed once the former British colony was returned to China in 1997 and became a part of the world’s largest economy. The energy and excite-
ment that had drawn many like Staes-Polet to the island nation’s music industry seemed to have suddenly diluted. China started focusing more on the manufacturing industry and family planning. Not very happy with the new set of goals, Staes-Polet decided it was time to move again. His next stop was Singapore, where Staes-Polet worked with IBM as the Asia-Pacific head for its media and enterAUGUST 2010
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tainment division. Though a rewarding environment, it wasn’t enough for Staes-Polet. The thought of starting his own business had been playing on his mind for a while. As part of his work, he had been helping clients across the region in setting up their business strategies for online games. These customers, mostly in Korea and China, had built flourishing businesses. And that’s when he saw the light. “The gaming industry brought art and technology together, and I am passionate about both these things,” he says. India became the obvious choice for starting up, as StaesPolet believed that its gaming market had the potential to be as big as similar markets in the US and China. He was also confident of his ability to startup a business, since he had helped establish a couple of companies in Hong Kong. Kreeda Games was started the humble garage way in 2006, by Staes-Polet and two other friends, Robin Alter and Ramesh Anumukonda, who were his colleagues at IBM. It began by publishing online games, however, since the recession of 2008, Kreeda has changed strategy and is now
Company Dashboard
into conceptualising and developing games for international clients and markets. Along the way, it has also picked up US$4 million in funding from IDG Ventures and SoftBank Bodhi Investment, both top venture capital firms in the online gaming space in emerging markets. Through the past few years, the trio at Kreeda stayed focused on what mattered most for the business—revenue. “We experimented less and focused on concrete money-making businesses, such as game development,” explains Staes-Polet. Their efforts seem to have paid off. Kreeda claims it is India’s “first dedicated multiplayer online game operator”, and offers a host of related services like micro-transaction billing, online ad servicing, traffic analysis and content management. As an expat entrepreneur who has lived through the turbulence of an economic downturn, Staes-Polet has some advice for future entrepreneurs looking to set up a business in India—be open-minded, pick teams carefully, run a tight operation, and invest on developing work ethics. After all, it’s all these components that make entrepreneurship one hell of a game. —Sunaina Sehgal
KREEDA GAMES
FOUNDER: Quentin Staes-Polet AGE: 42 LOCATION: Mumbai YEAR OF FOUNDING: 2006 LATEST TURNOVER: NA NUMBER OF EMPLOYEES: 35 FUNDING PUT: About US$300,000 BREAK EVEN PERIOD: Last year QUALIFICATIONS: Engineering from the Free University, Brussels RED TAPE FACED: Rigid business regulations BEST PART OF DOING BUSINESS IN INDIA: Since
people are used to steering things around rigid laws and regulations, there is a lot of innovation in terms of getting things done and getting results by hook or crook WORST PART OF DOING BUSINESS IN INDIA: A lot of time is spent on hiring the right person. Getting the person with the same point of view is difficult. The environment for HR looks very unpredictable and unreliable in India
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NEW MEDIA ADVERTISING COMPANY
Gotcha! Impact Media Putting together a whole new arsenal for advertisers Tucked away in an almost unnoticeable bylane of Lajpat Nagar, a bustling neighbourhood of Delhi, is a redcoloured office from which Noreen van Holstein runs Gotcha! Impact Media. Its location is rather obscure and makes it hard to imagine that a whole new form of advertising arsenal is being fired from here. Over the past five years, Holstein has taught Indian companies to use postcards and washrooms as an advertising tool, run their onground promotional activities, as well as brought out a mini magazine called Spot. It was something about India that stirred the entrepreneurial urge within Holstein. A native of Netherlands, she used to work for the Red Cross Society before she landed in India in 2003 with her husband, a correspondent for a Dutch newspaper. Today, both run their own businesses— while Holstein runs Gotcha!, her husband Jack Leenaars founded DelhiByCycle, a company that conducts cycle tours around the city. Arriving in India, Holstein initially took up a job with a business process outsourcing company in the travel sector. One day, she chanced upon an empty post-card rack. Having grown up around such creative ways of advertising, she decided she wanted to do her bit to fill up those racks. “It was something fun and was missing in India. It was worth a try,” she recalls. So, in 2005, she started Cards4U to promote postcards as an advertising tool. “I remember walking door-to-door,
where one can freshen up. For them, it is equal to dirt; something that should be kept away from,” offers Holstein. None the less, the company has managed to harvest steady clients like Fox History Channel, Flying Fox and Sony BMG. What keeps the mission afloat, despite the inevitable cultural challenges, are India’s endless opportunities. Holstein, however, admits that converting such opportunities into viable projects is often a daunting task. “Foreigner or native, one can’t make money on the basis of face value. We have to continuously prove ourselves. As a foreigner, first introductions are easy. Everyone gets inquisitive about ‘this foreign lady’ wanting to do business. But it is the follow-up that requires hard work.” Holstein has also understood that Grabbing Eyeballs building a business in India is very difIndian firms have adopted new media advertising tools offered by Noreen van Holstein. ferent from building one in Europe. “Here, people want to invest in the basic essentials for starting a business. Back in Europe, people would invest a lot of time and money in just preasking nearly 50 outlets if they would keep postcard racks, of senting the office.” She, however, admits that the market for postwhich 40 agreed,” she recalls. Holstein persuaded companies such card advertising was limited in Europe. It has also taken her some as Bizzare and World Space to use postcards to promote their time to come to terms with the work ethics of the country. “Peobrands. “First, I did the convincing, now, the medium does the ple just don’t dispatch goods on time,” she sighs. convincing,” she says. Her clients now include many multinationShe also believes in planning ahead. “My motto is be-ready to als, such as Unilever and PepsiCo, as well. sell, even though it is not necessary to sell. It helps in planning and However, she soon discovered that the business offered pretty managing the inventory. Why wait for the 11th hour?” low margins. So, in 2008, she set up Gotcha! to offer additional But even such meticulous style of functioning couldn’t insulate services, such as washroom advertising. Gotcha! from the recession. “Though my business did not suffer Within eight months of set up, Cards4u opened up in Bengal-
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GOTCHA! IMPACT MEDIA
FOUNDER: Noreen van Holstein AGE: 36 LOCATION: Delhi YEAR OF FOUNDING: Proprietorship (2005) | Pvt Ltd (2008) LATEST TURNOVER: Rs 2.5 crore NUMBER OF EMPLOYEES: 17 FUNDING PUT: Rs 12 lakh BREAK EVEN PERIOD: After eight months BIGGEST EXPENSE: Post card racks and office assets QUALIFICATIONS: Master of Law degree from the University of Amsterdam, Netherlands RED TAPE FACED: Visa laws for foreigners in India are not sound BEST PART OF DOING BUSINESS IN INDIA: Holstein loves the flexibility in Indians—the fact that irrespective of the nature of work, it gets done in India; or in other words ‘jugaad’ WORST PART OF DOING BUSINESS IN INDIA: When pakka actually means Insha Allah
uru and Mumbai, and is now operating in nearly 15 cities. Racks have also been put up at educational institutes, such as the University of Delhi and Bombay University. Though her magazine Spot has had a smooth ride so far, the same cannot be said for AdtheLOO, Holstein’s brand of washroom advertising. The point of conflict seems to be the Indian perception about toilets, which prevents companies from using them to advertise. “Indians still don’t consider restrooms as a place PHOTOGRAPH BY SUBHOJIT PAUL
too much, advertising took a huge hit. Many corporates backed out, or pruned their budgets drastically. Cash flow was affected the most. We had to wait for six months for clients to pay us.” With the storm over, Holstein is optimistic about growth. “We want to grow to Rs 3.5 crore this year,” she says. Her plans to stay on in India are also flexible. “Maybe I will stay three more years, if the visa is extended; maybe, I will start a new business, or maybe I will sell this present business and pack for home.” —Sunaina Sehgal AUGUST 2010
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RETAIL COMPANY
Purple Jungle Showcasing India’s funky side for the niche class “India has taught me how to stay calm,” says 33-yearold Iris Strill, a freelance designer, as she finishes a dabba lunch of roti, dal, and sabzi in a small sit-out balcony, surrounded by a messy gridlock of electric cable wires which wind through impossibly narrow lanes and angular houses in Hauz Khas village. This is Delhi’s artsy neighbourhood, dotted as much with historical monuments from the Delhi Sultanate era as with crooked buildings that house quaint cafés, art galleries, designer stores and restaurants. “You learn not to get disappointed here. Like, when the internet is not working, or the electricity goes off, I just get out of the office and run errands then,” she adds with a sigh. Hard as it is to imagine chaotic India teaching anyone to remain calm, it is even more difficult in the case of Strill, given that she, along with her business partner, Emeline Grasset, has just embarked on the frenetic, and often frustrating, journey of setting up a business in India. The vibrancy of the country, which has attracted these two French ladies, is probably best reflected in their products—a range of kitschy, urban accessories like 44
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Contemporary Crafts As far as Iris Strill is concerned, kitsch is so cool.
PHOTOGRAPH BY VIJAY KUTTY
THE EXPAT CLUB OF COMMERCE
bags, trays, posters, coaster and stuffed toys. Their threemonth-old design studio is appropriately christened Purple Jungle. For a start-up—the store opened less than two months ago—things seem remarkably calm at the store. The products, carefully priced between Rs 150 and Rs 2,000, are neatly stacked along the two walls of the outlet and dramatically displayed on the floors at the studio. They use imagery emblematic of India—think matchboxes, Bollywood and and steel utensils. Strill, who has “more or less” lived in India since she first came to work on a textile project 10 years ago, admits that things have moved “shockingly” fast. “We started talking about it only four months ago. Then, one day, Emeline said, let’s go check out Hauz Khas Village. And, the shop space downstairs is the first space we saw,” says the graduate of a design school in France. Both Strill and Grasset are natives of France. The duo, coincidentally, kept bumping into each other socially, until they decided to work out a business together. They have managed to move rather quickly, courtesy 31-year-old Grasset’s experience in running a business in India. She started ParisDelhi, a buying house that helps
European designers to source products from India, in 2006. At Purple Jungle, the girls have stitched together some smart alliances. They have a barter agreement with an Indian manufacturer, with whom Strill has been working as a freelance designer for the past four years. Purple Jungle designs products, which are then manufactured by this firm on the understanding that Strill and Grasset will sell those products only in India. In addition to the challenges faced by most expat entrepreneurs while launching in India, the two women have had to struggle with production issues, so much so it has “kept them up at nights”. “For production, there are two key things you need— respect for time and good quality. It’s very difficult to find people who respect both,” she says. It hasn’t been easy “being a woman in the garments production field” here. “In fact, I have picked up only one Hindi word pat down, and that is mushkil (difficult),” laughs Grasset, who first came to India in 2005. Ironically, that’s also what is rewarding about working in India. “You feel everything is possible here. You can find a solution at any time, and at any cost. When you are in trouble
HINDI WORDS WE LOVE TO USE Achha
Theek Hain CHALEGA Bahut Kam
Jaldi PANI
Kitna baje?
Kitna Paisa? Nahin Hindi
Chup Rani/Raja
Mera Baccha
CHAI Masala
Desi
Duniya
SADU Lal Namaste Atithi devo bhava
Kamchor Company Dashboard
PURPLE JUNGLE
FOUNDERS: Iris Strill and Emeline Grasset AGES: 33, 31 LOCATION: Delhi YEAR OF FOUNDING: May 2010 NUMBER OF EMPLOYEES: 5 START-UP COSTS: Rs 12 lakh BEST PART OF DOING BUSINESS IN INDIA: India offers different
experiences. In France, there are different people for every task. Here, you can do everything. When I am bored, I shop in Chandni Chowk for fabric WORST PART OF DOING BUSINESS IN INDIA: Production issues
Paisa Vasool Chuttha nahin hai
CRORES Timepass
Aare yaar! Bandh
in the day-to-day life, there is always another possibility,” she adds. Although they both continue to work on their previous professional commitments along with Purple Jungle, they have ambitious plans ahead. But, “it’s just the beginning, beginning. We are still scoping things out,” cautions Strill. So far, the duo has pumped in Rs 12 lakh into the business. They already sell out of Zaza, an upmarket store in South Delhi, and hope to find more such places to sell out of. Opening up more stores requires budgets that they do not immediately have. Therefore, the two are keen to ink supply deals with shops in Goa, Pondicherry, Mumbai and other cities. Not that they are not eyeing the emerging Indian market. “We want to make Purple Jungle big in India. In a year, we want to get into the biggest cities and the nicest shops,” says Grasset. “There is a window for funky things here. There is too much of the standardised, mall culture,” echoes her business partner. For now, they are relying on the magic of word-of-mouth to lure in the customer. The only marketing investment so far has been a Facebook account, but Strill justifies it by saying, “we are still very, very new”. Which is why more often than not, running Purple Jungle doesn’t seem like work. “I have been working as a freelancer for so long now that I really enjoy having somebody to run a design by. It isn’t so lonely anymore. It’s been a lot of fun,” Strill adds. It’s a joy that has found easy depiction in their busy, colourful products.—Shreyasi Singh AUGUST 2010
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HOTEL COMPANY
Neemrana Hotels Adding a dash of warmth to hospitality 46
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PHOTOGRAPHS BY SUBHOJIT PAUL
THE EXPAT CLUB OF COMMERCE
Francis Wacziarg’s romance with India started in the seventies and continues to this day. Any story on expatriates who run businesses in India is incomplete without a mention of this 40-year love affair. Not only does he run multiple businesses here, the 68-year-old even became an Indian citizen in 1990. “I landed at Mumbai and it was love at first sight. People ask me why I stayed back in India. I didn’t stay back; I stayed from Day 1,” says Wacziarg, of his first trip to India in 1970. Instead of travelling
like a tourist along the usual route of Agra and Rajasthan, he visited the villages of South India, and even stayed with a poor family in the Chikmangaloor district. By the end of it, he knew he would not be able to stay away from the country. During these years, he’s found himself a co-author and business partner in Aman Nath, and together, they’ve given India its first taste of “non-hotels” under the Neemrana Hotels brand. Although more visible, Neemrana isn’t Wacziarg’s first or only business in the country. Way back in 1978, when there were very few people selling brand India abroad, Wacziarg started a buying agency. “I started with two clients—and very little money,” he recalls of his early days after leaving the security of his job. The agency continues to run to this day—incidentally, shares his name—and sells everything from garments to furnishing, furniture and accessories. His story is unique in every which way you look at it—be it the 35-year-old partnership with Nath, an Indian, the multiple books they have written together on Indian art and culture, and the change they have brought about in the declining fortunes of the erstwhile royal families of India. While there are several foreigners who come to live and start businesses in the subcontinent—its vitality and growing economy triggering the moth-and-the-flame attraction—there are not many who make it their home. “Not many of us have taken on Indian citizenships and are in business,” he points out. When Wacziarg decided to set up his buying agency here, India did not even have a provision for “self employed” foreigners. “I had to go and see the Reserve Bank of India and the Ministry of Finance to find a way to stay in India,” he recalls, rather amused. Wacziarg’s love for the country was for all to see. Not only was he involved in building business links between India and France, he was also an ardent promoter of the Indian arts movement. In 1972, Wacziarg had organised the first-ever festival of Indian films in France that ran Indian cinema for an entire week in Paris. He was also involved in “the young cinema of Shyam Benegal”. This was the seventies; the country was still evolving culturally and politically. “There were only two galleries in Mumbai and one in Delhi. It was an extraordinary time. I’ve seen India change. I am living through the third generation after independence,” he says. And, then, in 1975, he met Nath in Delhi and they decided to explore Rajasthan together. Their attempt to make a film on the water systems of the desert state didn’t go very far, but their work on the frescoes of Shekhavati and the arts and crafts of Rajasthan was compiled into two books. Their ultimate business venture didn’t appear till 1986, when Nath bought their first property from the maharaja of Neemrana for a sum of Rs 7 lakh. As a foreign citizen then, Wacziarg was not allowed to own property in India. The beautiful palace was in ruins and there were no takers. “The Oberoi hotels had sent their team to survey it, and were advised not to touch it,” recalls Nath. But the duo was not willing to give up. They had tried restoring a couple of country homes in the months before the Neemrana palace came up on their radar. AUGUST 2010
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“We realised that, at least, in this century, we still have the techniques of carving stone and building jharokas and chatris. So we tried our hand at this,” explains Wacziarg, of what was considered a totally mad move. What began as a passionate journey to save an abandoned 15th century heritage fort morphed into an interesting business proposition. In the process, the Nath-Wacziarg partnership got a chance to salvage and restore historical buildings, something the government and royals had struggled with rather unsuccessfully in the past. “It took all our energies and time. And, there wasn’t much money,” admits Wacziarg. That, of course, is now a distant memory. Both he and Nath have an equal ownership in the Neemrana Hotels and another company that runs the hotel properties. They operate 23 “nonhotels” across 17 destinations, ranging from four-roomed houses to nine-floor palaces. The company has done well for itself, growing at about 20 per cent to 25 per cent a year since the beginning, except the last two years, when it grew between 10 per cent and 15 per cent due to the economic slowdown. With a turnover of Rs 30 crore, it is nowhere close to the giants of the hotel industry. But, “the business has notched up a reasonably good percentage of profits,” which enables investments in new projects. New properties are either funded by the duo, or by the owners. “We give them a percentage of the turnover, not the profits, so they don’t have to wait for income,” explains Nath. It is no wonder that several erstwhile maharajas and palace owners have come forward in the recent years to sign up with Nath and Wacziarg. The duo gets nearly five proposals a week and are usually criss-crossing the country, evaluating the feasibility of those properties. They select the properties very carefully, keeping an eye for financial viability as much as aesthetic appeal. Some of their hotels have just four or five bedrooms—which makes it difficult to make much money off them. At many places, such as Ramgarh, they have innovatively opted to operate multiple small properties within 10 minutes walking distance of each other. In all their properties, these unlikely hoteliers have followed certain principles—be it employing the local population, or serving
the community through initiatives such as churning out jams and chutneys from the fruits of the orchards at Ramgarh, or growing their own tea at Kunoor. “We want people to represent the culture of an area since we want to be as authentic as possible. We don’t try to standardise our offering like other hotel chains.” And therein lies the charm of these properties. The two owners share this vision and sincerity of purpose. Their partnership is rooted in a common value system that emphasises
“We do things that we love doing. We don’t do them for anything else. We have no vision plans; we take things as they come. We survey proposals and decide. Our only vision is to die with our boots on.” 48
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In the Lap of Luxury Francis Wacziarg and Aman Nath pride themselves on running ‘non-hotels’ under the Neemrana brand. Each property showcases a different slice of royal India.
as much on the emotional aspect of business as on the financial. Of course, hitting the right numbers does count but neither Wacziarg nor Nath can fit into the mould of the stereotype businessman. “We do things that we love doing. We don’t do them for anything else. We have no vision plans; we take things as they come. We survey proposals and decide. Our only vision is to die with our boots on,” laughs Wacziarg. Make no mistake, though. Despite their otherwise full lives, they are “very hands-on and don’t delegate much of” their work. They travel frequently, mostly independently of the other, to evaluate properties, though all decisions are taken jointly. Thereafter, they work together on the restoration of properties, where they bring in architects to carry out the work decided by them. “Since we are both based in north, we bring in architects for the restoration of our properties in south India. Otherwise, we do the work ourselves,” explains Nath. They have even won the Aga Khan award for architecture for their restoration work at Neemrana. They pay attention to the minutest of details—from the overall look and feel of the property to the furniture and paintings to be used there. “The running of a property is what we delegate to our team, after training and empowering them,” says Nath. While the northern and southern parts of the company’s operations are handled by regional managers, every property has its own manager, who is ably supported by a food & beverage man-
ager and a deputy manager.. The company has two training centers, one at Neemrana and the other at Puducherry for recruits from the two regions of the country. “It’s easier to train a guy from Cochin in south than send him to north India,” they explain. There is no fixed division of responsibility between the two. “We work very closely. We don’t have demarcated areas of work. Our sensibilities are the same. Our offices are just next to each other, so we keep asking for each other’s opinion,” explains Nath, who had been handling everything for the past month that Wacziarg was away. There are some clear areas of preference, though. Given Nath’s work experience in advertising, he handles all advertising and marketing activities. “Francis is the foodie, so he handles food and beverage,” laughs Nath. “Aman is more involved in the architectural aspects of the business, and I take care of the business side,” adds Wacziarg. But both ultimately share a sincerity of purpose—be it the love for restoring dilapidated buildings, or the ability to treat business as a means to an end rather than an end in itself. “We’ve always been like that,” adds Wacziarg. The two “Jacks-of-all-trades” lead rather rich lives between their books, music and hotels. “We’re writers on one day, music lovers on another, and hoteliers the next,” says Wacziarg. —Pooja Kothari AUGUST 2010
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Warm Regards Because David Rosen develops his own leads, he looks forward to every call he makes.
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THERE’S NO SUCH THING AS A WRONG NUMBER And eight other nuggets of voodoo sales wisdom from David Rosen, the happiest cold caller you’ll ever meet. BY JOHN GROSSMANN
PHOTOGRAPH BY R JEROME FERRARO
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As matches go, this one was near perfect: a chance meeting of a freelance writer always on the lookout for his next story and a commission-only salesman constantly looking for a lead. We met over a copy of this magazine. Literally. I stood in line to pay for a newspaper and the December-January issue of Inc., which I had grabbed off a rack at a newsstand at the San Francisco airport. Referring to the headline on the bottom right-hand corner of the cover, the man behind me volunteered, “I could write a story about micromanaging my first company.” It wasn’t long before he was introducing himself and handing me his business card, which identified him as a personal wine broker with Grove Street Brokers in Healdsburg, in Sonoma County. I fumbled for my own business card. Realising I didn’t have one with me, I pointed higher on the cover to the slug “Five Years of Start-Up Insanity: Was It Worth It?” “I wrote that story,” I said, and told him he could reach me through the magazine. He e-mailed me the following day. And when we spoke on the phone a week later, David Rosen sold me. Not a case of wine. (Though he did 52
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inquire if I prefer reds or whites and asked a few questions about what characteristics I prefer in the wines I drink.) Rather, calling from his home office in a suburb of Cleveland, he sold me on the idea of writing about the sales strategies that allow him to sell half a million dollars’ worth of wine a year to private individuals nationwide. If not at hello, he pretty much had me when he told me about his extensive database and the dozens of customers coded with the initials ACI, for accidental call-in. Rosen’s repertoire includes cashing in on wrong numbers! Granted, Rosen’s patter pertains to a nuanced, enjoyable, lifestyle-type product that opens the door to a playful approach. If you sell hip replacements or home security systems or caskets, not all of his techniques and tips will necessarily work for you. (You will probably want to forget No. 9, which involves making a pitch while naked.) But any salesperson can learn from the follow-
ing cache of cold-calling tips, performance techniques, and e-mail procedures, which have made Rosen the top seller at Grove Street Brokers.
THERE’S NO SUCH THING AS A WRONG NUMBER For some reason, in his first stint with Grove Street Brokers, from 1992 to 1998 (he left to start a Web application development company), Rosen rarely went more than a week without an incoming wrong number on his toll-free phone line. One day, instead of cursing yet another unwanted interruption, he opportunistically countered with a kind of verbal jujitsu. “Unless you’re a wine drinker,” he said, “it looks like you’ve dialled the wrong number.” He paused a second and then smoothly flipped the call. “Tell you what. Since I’ve got you on the phone and I’m not shy, I’ll give you my quick 60-second speech, and you can see what you think...” Although he hasn’t kept track of all incoming wrong numbers, Rosen’s 30-megabyte database has 92 names coded ACI. Meaning, these individuals listened to his spiel, told him a bit about their wine preferences, and provided him with contact information. Seventy-five of these ACI’s, more than 80 per cent, became customers. Among them is Keith Burgess, a seller of commercial window treatments for Hunter Douglas. Three years ago, Burgess misdialled trying to reach his mother. He got Rosen’s fax line and quickly hung up. Then Burgess’s phone rang. “Did you just call my number?” Rosen asked. “Yeah; sorry about that.” “Wait, can I ask you a question? Do you like wine?” As it happens, two of Burgess’s best friends own wine stores, and he loves nothing more than to visit them. Wine talk ensued. The dialogue continued. “He’d call about every three months, just
VOODOO SALES TIPS
Take notes from every call you make or attend. And add all nuggets of information to your database.
a quick, few-minute conversation,” says Burgess. “I told him when I got my bonus in January, I’d probably buy from him. Salespeople are harder to sell than anybody else. I was quite impressed that he called back and then was able to flip the conversation. He was taking a 50-50 gamble: I’m either going to say yes, I like wine, or no. Between that and his tenacity of follow-up, I finally said, ‘I’m going to give this guy a try.’ “
PHOTOS.COM
COLD CALLING IS A MATTER OF DEGREE Yes, you can work from income- or homevalue-sorted lists provided by lead-generation companies, but why live with meagre success rates (1 per cent to 2 per cent, a fellow Grove Street broker confessed to Rosen in a recent sales training session) when you can push your success rate considerably higher by much more narrowly prequalifying leads you gather yourself? Rosen rustles up plenty of potential cli-
ents with creative online searches. He plumbs the letters columns of various wine publications, scrolls through wine blogs, and Googles fruitful word combinations like wine club and the names of various cities. As one of 11 brokers at Grove Street, he sells limited-batch wines made by small, mostly California, wineries to private individuals who otherwise probably wouldn’t have access to such wines, which range in price from around US$15 per bottle to many times as much. Once he has identified a lead, Rosen generally spends a few more minutes on the Internet in search of potentially helpful information about the person, insights that might also help him take even more of the chill off a cold call. Tracking an individual to his or her place of business often supplies not only a job title and office phone number but in many cases a photograph that suggests the person’s age and perhaps demeanour. You don’t want to stalk a prospect, but the more you know, the better.
Consider Rosen’s first phone conversation with John Brinzo, in August 2003. It was anything but cold. Rosen had already qualified Brinzo as a wine drinker: He had read in the home section of the Cleveland Plain Dealer about the wine room that Brinzo and his wife had added when they remodelled their home. Rosen found the home number and dialled it. Brinzo’s wife answered. “It was very uncharacteristic of my wife, Marlene, to do that,” says Brinzo. “We have caller ID. If we don’t know the party’s name, we don’t generally pick up the phone, and normally, on cold sales calls like that, they get nowhere. David comes across as a rather honest, charming, and engaging individual. He’s certainly not a pushy guy. He must have charmed my wife, because she gave him my work number. She told me he’d be calling: ‘You’re not going to believe this guy; he’s very engaging.’ “ Marlene Brinzo had told Rosen that her husband worked at a company called CleveAUGUST 2010
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land-Cliffs (now Cliffs Natural Resources). Before calling, Rosen Googled the company and learned it was the nation’s leading supplier of iron ore. He also discovered John Brinzo didn’t just work at ClevelandCliffs. He was chairman and CEO. Rosen smiled, surmising these were not stuffy, pretentious folks. In other words, perfect for his anti-wine-snob sales MO. To date, John Brinzo, who has since retired, has placed 33 orders with Rosen.
GATEKEEPERS ARE TO BE RESPECTED Rosen’s first commandment for cold callers: “Don’t feel the need to get past the gatekeeper the first time.” Usually the gatekeeper is an assistant or, if contact is being attempted at home, a protective spouse—or one who might not want to encourage a mate’s wine jones. Start out too aggressive with either, and the gate will probably stay shut. So don’t push on the first call, Rosen advises. Use it to collect information that will prove helpful later. Take note of the assistant’s name so you can use it the next time you call. Take special note of the first name used for the Mr. Smith you asked for. Is it William? Or Will? Or Bill? Ask: “When do you think is a good time to catch him?” Rosen generally doesn’t like to leave a message on a first or even second call. He has found persistence often pays, for it demonstrates what many deem a desirable trait. In fact, if Rosen realises after several unsuccessful tries that he must leave a message, he may even highlight his
perseverance, introducing himself as that “persistently optimistic wine guy” before briefly explaining his service as a wine broker and providing his memorable toll-free number: 877-CAL-WINE. Rosen does confess to one off-the-wall gimmick almost guaranteed to get you past even the most protective gatekeeper. “This was an idea from somewhere in my salesman’s DNA,” he says. “I Googled doctors and lawyers and professionals named David Rosen. You know they’ll always take my call.” He sold a bit of wine thanks to this Abbott and Costello—like “Who’s on First?” stunt, but he has only one David Rosen, a music-store owner, among his current clients. And he was a referral. Rosen says the name trick is perhaps best used like batting practice, to warm up and get energised for the real game.
THE CUSTOMERS KNOW THEY ARE CUSTOMERS Theatre people talk of breaking the fourth wall—stepping out of character and speaking directly to the audience. Rosen, who has acted in community theatre, has discovered this technique helps grease the sales skids, at least when the product is wine. What he does is fairly uncommon and not for those lacking confidence or chutzpah. Quite often, he openly makes fun of the sales process. “I acknowledge that I recognise this dance we’re doing,” Rosen says. “Yes, these wines are better than you’re going to find locally, and yes, I am picking them specifi-
You could jack up on coffee or Red Bull, but a better way is to be genuinely enthusiastic about what you’re doing. 54
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cally for you, and they’re just freaking wonderful. But it’s not health care. It’s not a mandatory thing in their lives. I also want them to appreciate and respect the fact that if they don’t spend money with me, I’m not making a living. “I can drive the conversation, and it’s my job to drive the conversation, but I also want them to know that I understand that ultimately, they’re in charge here. So I make fun of the fact that I’m on the phone trying to get them to spend money. I’ll say, ‘This is just the wine salesman in me, so be careful.’ “ When Rosen is using e-mail, he tears down the fourth wall with a self-deprecating but transparently self-serving ploy in search of new business: his occasional Pester My Clients for Referrals Campaign®©. What kind of a salesman jokes that he has registered and copyrighted such a baldfaced favour-seeking mass e-mailing? The same kind whose clients respond, “Why do I yield to this kind of temptation? But send me a mixed case.” Which provokes Rosen to sign off, Yours in voodoo.
LEARN YOUR SCRIPT, THEN DITCH IT In an earlier career, Rosen toured as a backup musician for Elvin Bishop and also Peter Tork, post-Monkees. (His home office, in fact, is a backyard-facing room that also serves as his recording studio and is accordingly half filled with amps and microphones, percussion equipment, a tenor sax, and various guitars.) The sales connection? Having become skilled at memorising music and heeding onstage cues helped Rosen from the very start eschew a sales script and treat each sales call like a song, with key phrases and talking points akin to chord changes. So, tip No. 1 for avoiding the fatal flaw of sounding as if you are reading from a script: Write one if you must, but quickly ditch it -- after committing its key messages or bullet-point reminders to memory. Rosen wears a headset, not just so he can take detailed notes and, if need be, quickly search online for information about a wine or vineyard he is unfamiliar with but also so that he can talk with his hands. He finds
VOODOO SALES TIPS
this energising. And staying energised, he believes, is crucial to keeping a sales pitch sounding new and fresh. “You could jack up on coffee or Red Bull,” he says, “but a better way is to be genuinely enthusiastic about what you’re doing. It’s not just about making money. It’s about establishing a new relationship.” He advises: “Picture you’re talking to someone else, when, in fact, you’re talking to the window in your office.” And slow down. Insert pauses in your pitch to let your message sink in. A simple and effective way to assess your spiel and hear how stiff or natural you sound is to call your own number from another line and start speaking at the beep. Your answering machine stands ready to assist you.
PHOTOS.COM
DATA ARE GOOD. MORE DATA ARE BETTER After his gregarious, self-effacing sales persona, Rosen’s most valuable asset is his database. It’s the engine that drives his sales. He uses Microsoft Access, which allows him to easily import Excel spreadsheets. “Being kind of geeky, I’ve customised it to show certain fields that I create with data,” he says. Rosen takes notes by hand when talking with current and potential clients and then later types those notes into his database. “I’m sure David’s take on my wine tastes is more sophisticated than my taste in wine is,” says Robert Siegel, host of NPR’s All Things Considered. An avid NPR listener, Rosen called Siegel cold, pegging him for a likely wine drinker and knowing he would be energised the moment he heard Siegel’s familiar voice. “David’s very thorough,” Siegel continues. “He knows my preferred price range. And what kind of wines I want and what might be like the Stonewood Merlot that he was selling me for a long time that I liked so much.” In his data entries, Rosen employs abbreviations and codes not just to simplify the task. He does so to protect himself from corrupting his data. The fewer the keystrokes, the less likely he will be to make a typo—one that might cost him a sale. So SB
Take note of the assistant’s name, so that you can use it the next time you call up the person.
stands in for Sauvignon Blanc, ensuring that when Grove Street gets in an especially good Sauvignon Blanc and Rosen does a keyword search to root out his lovers of that varietal, he won’t miss a couple of potential customers because his fingers had fumbled typing S-a-u-v-i-g-n-o-n in their notes fields. An exclamation point or the word fave indicates a person’s strong love of a particular wine. Rosen taps on the keyboard of his laptop, and the screen changes. “There’s 958 people who are big Chardonnay fans,” he says. “Now, how many of them like it real buttery? Or oaky? I’ll filter by the word oak....We’re down to 265.” In like manner, Rosen can call out his Zinfandel lovers and aggregate their e-mail addresses in a Microsoft Word document— all 817 of them—and have that at the ready for a mailing via Constant Contact, which he uses for bulk e-mails too big for Outlook and his Internet service provider. Rosen’s database runs to 2,168 names— 275 of them coded 8888, his shorthand for Do not call anymore. Why not discard these?
“It’s my style to keep everything,” he says. His pack-rat mentality came in handy once after a client died and his wife gave away his wine to some of his best friends. One of those friends contacted Rosen a while later, hoping to get the name of, and buy more of, the wine he had enjoyed. Rosen’s database is also a key motivating tool. He monitors sales as closely as he does customers. “Most people don’t know where they stand financially, either with personal budgets or sales budgets,” he says. “That’s why my spreadsheets are so elaborate.” He once tracked the number of sales calls he made a day. Now he focuses on income— and net income at that. “Knowing what you need to make, you might be surprised at how doable that is,” he says. “If I average US$344 per case and I want to sell US$10,000 a week to net US$2,000, I need to sell 29 cases. That sounds like a huge amount, but that’s five cases a day, if I work six days.” Moreover, dedicated parsing of his database shows precisely where his sales come from—and, therefore, how best to allocate AUGUST 2010
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Sales leads can be harvested anywhere. In a locker room. In an airport newsstand checkout line. Even in a doctor’s office. his time. Of last year’s 1,213 orders, 90 came from first-time customers, accounting for 7.4 per cent of sales. More than three of four new clients—69 of those 90—were from referrals. Rosen also knows he made 420 sales by phone, 648 sales by e-mail, 143 by a combination of both methods, and six sales at a personal wine tasting.
A GOOD SALESPERSON DOES MORE THAN SELL Rosen strives to inspire loyalty in his customers, and the key to that is trust. He earns it by keeping his promises. His first promise, made during an initial, exploratory phone call, is to follow up immediately with an e-mail restating what his service as a personal wine broker entails. He has a canned recap ready to paste into the body of the e-mail, but he will always change it a bit at the beginning or the end, to include something said in the conversation. He cautions: “It’s going to come from David, Your Wine Guy, so you’ll know it’s not spam.” Already, he is branding himself, while the iron is still hot. He is a gifted talker, but he is also a dedicated listener. The notes he takes allow him to reliably hit the mark with repeat customers, who come to trust his personalised wine recommendations. Says Brinzo: “While he frequently sends out e-mails advertising some great buys on more expensive wines that are clearly more toward the collector guys, he knows what I want to pay, and he’s 99.9 per cent right.” With some clients, especially those with a need to talk about personal problems, Rosen listens like a bartender. “If I were just a pure sales dog and wanted to double my numbers, I would cut my conversations by 70 per cent,” he says. When the need arises, he will deliver 56
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more than great wine at fair prices. He will assist a client who asks for help, say, hosting an important business dinner. Rosen will check out the restaurant’s wine list online and e-mail a few recommendations to pair with various likely entrée selections.
NOTHING IS MORE VALUABLE THAN A GOOD REFERRAL Truth is, Rosen no longer has to make a slew of daily cold calls to meet his weekly sales goal of US$10,000. His business hums along nicely on referrals. You can’t be afraid, he stresses, to ask your current satisfied customers if it’s OK to contact their friends and colleagues. Just don’t rush that request. Like a good wine, the customer-salesman relationship needs to age, to settle in a bit. “A good rule of thumb is after the second sale, and you’ve checked back in and you’re about to talk about their third order, now’s a good time,” Rosen says. “They’re clearly excited. They haven’t tired of this game yet.” But the key is trust. “Do they trust that you’re not going to go beat up on their friend?” When he reaches that point, he will say something like: “Now that you’ve got a feel for what I do and my style, who else do you think might be interested in The Wine Guy, because, of course, that’s how my evil empire spreads.” At National Public Radio, Rosen’s Robert Siegel beachhead has spread to 19 clients. That’s far from his biggest sales pyramid. He has one stemming from a single cold call in October 2003 that brought him a referral in February 2004. That referral has spawned a prolific order tree that branches through five more levels of referrals. In all, one customer has led to 38 more customers. Referrals rule in the house of Rosen. Of the 373 individuals who bought from him in 2009, 295 of them were referrals. In fact,
some 81 per cent of last year’s total sales could be traced to referrals.
NUDITY IS NO EXCUSE (NOT TO PITCH) Rosen once pitched a stranger while towelling down in the locker room at his local gym. He started chatting with a guy changing into his workout clothes. After learning enough about the man to think he might be a prospect, Rosen made a self-effacing comment about the 25 pounds he could afford to lose, thanks to his work-related “Cabernet abuse.” A locker room, Rosen says, is a great place for eye contact and reading people’s faces. In this case, the person Rosen reached out to turned out not to be much of a wine drinker, but he did buy some wine for his daughter and son-in-law and has also connected Rosen with others. Sales leads can be harvested most any time, anywhere. In a locker room. In an airport newsstand checkout line. Even in a doctor’s office waiting room—in a five-yearold magazine. Recently, while thumbing through a dog-eared copy of Better Homes and Gardens, Rosen spotted a wine rack on the kitchen counter in a home-makeover photo. The story mentioned the names of the homeowners, and with some Internet research, he tracked them down. “I called last Saturday and got the husband,” Rosen says. “He loves the idea of a personal wine broker. He used to live in California and misses the microwineries. Tells me his everyday pizza wine is US$25, and what he likes. I sold him a couple of mixed cases, a US$700, US$800 order. And he tells me: ‘Everyone in my firm loves wine. As long as these are good, you’re golden.’” John Grossmann is a regular contributor to Inc.
Managing Spinning off businesses this page Sales & Marketing How would you sell a composter that turns household garbage into organic manure? page 59 Sales & Marketing Four reasons to use pop-up stores page 62 The Way I Work K Ganesh depends on his 30-minute naps post lunch to power up TutorVista, his fourth entrepreneurial venture in last two decades page 64
Elevator Pitch Can Rs 5 crore help an alumni management platform go global page 60
STRATEGY Managing A Company of Start-ups How to spin off new businesses
PHOTOS.COM
Entrepreneurs often leave companies to do
their own thing. They flock to Maya Design for the same reason. Maya is a US$6.5 million technology design and research consultancy that grows, in CEO Mickey McManus’s words, “by cell division.” Over the years, the Pittsburgh-based company has spun off four businesses, and it has two more in the works. Successful spin-offs bestow multiple blessings on their parents, allowing companies to grow and diversify while retaining the efficiency and agility of a small business. Although spinning off businesses isn’t a new concept, most companies tend to treat spinoffs opportunistically. An employee typically submits a business plan to the owners. If the plan makes sense, there’s enough capital around, and the aspiring entrepreneur can be spared, the company may take a swing. Maya takes a more systematic approach—it has developed an infrastructure that can support one or three or five additional businesses. Maya was chiefly a design-consulting firm when it began launching spin-offs in 1998. At
Too Many to Count Successful spin-offs bestow multiple blessings.
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that time, it was eager to develop datavisualisation software for the military but feared that that might become a distraction. Its solution was to create two companies. Maya Design would handle the regular consulting work. A new business, Maya Viz, would develop the software for the military. Its founding team, mostly brought in from outside, would start as salaried Maya Design employees until Viz proved profitable. Meanwhile, Maya Group, another new company, would provide HR, accounting, legal, IT, and other support services to Maya Design, Maya Viz, and future spin-offs. Spinning off businesses in this way allows Maya to market products and other offerings that are complementary but not related to its core businesses. Two spin-off ideas being proposed involve iPad accessories and modular computing—potentially lucrative niches that are not naturally at home in a consulting company. Spinoffs are also easy to sell when the opportunity arises. Maya Viz was sold to General Dynamics in 2005. Maya Design incubates each spin-off for at least a couple of years, until it books enough business to stand on its own. Maya retains a majority share in each new business, but when a company spins off, its CEO and other founding principals—drawn from Maya Design or from outside the company—receive equity in the new business. This model has allowed Maya to recruit people like Chris Pacione, a founder of health-monitor company BodyMedia, whose products are used on the TV show The Biggest Loser. In 2008, BodyMedia was approaching its 10th year in business, and Pacione was contemplating a change. Enter Maya, looking for a tested entrepreneur to take its idea for a design-education company and run with it. Today, Pacione is CEO of Luma Institute, a spin-off that sends experts into companies and schools to teach design. Maya attracted serial entrepreneur Josh Knauer in a similar fashion. In 2002, Knauer sold his company Green Marketplace, a vendor of environmentally friendly products. He joined Maya the fol58
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Spin Masters Interested in spinning off companies as a growth strategy? Here are a few pointers from Maya Design. Seek partnershipsMaya often works with government agencies in the Department of Defense and the Department of Commerce. These collaborations produce intellectual property that is ripe for commercialisation, potentially as new ventures for Maya. Motivate employees to participate Maya licenses intellectual property to its spin-offs. The employees who invested the most time and effort developing the ideas are given a share of the licensing fees. Develop leaders Entrepreneurs recruited from outside to run spin-offs typically first work inside Maya for several years, learning the existing business as they develop the new one. Employees who aspire to be entrepreneurs are given opportunities that test and stretch them. Provide support Maya Group handles facilities, IT support, accounting, and legal services for the spin-offs. This gives even the newest spin-offs the operational muscle of much larger companies. Co-ordinate strategy and resources Maya formed a council—consisting of the leaders of the parent company and those of its spin-offs—that acts as a sounding board for its members. The council flags potential conflicts early and facilitates brainstorming.
lowing year. Maya offered Knauer the opportunity to spin off some of its homegrown software into a separate business in a family-friendly environment that allowed him to spend ample time with his infant daughter. “I couldn’t glow enough about what happens here,” says Knauer, CEO of Rhiza Labs, a spin-off that makes online mapping software. “I can’t think of a better model than Maya’s for starting slightly disruptive technology companies.” The CEOs of the spin-offs aren’t the only ones who benefit. The presence of the new ventures, which share offices with Maya Design, provides everyone in the company opportunities to try different kinds of projects, work with a variety of customers, and pursue new career paths, says McManus. He estimates that 80 per cent of Maya Design’s 32 employees have worked on one of the spin-offs. Rhiza Labs temporarily hires Maya developers when its six employees are swamped. Luma, which has only three employees, calls on Maya designers to teach at its clients’ facilities. Teaching “breaks up the pace for them and gives them an opportunity to become better designers, because that’s what happens when you teach,” says Pacione.
Every week, the leaders of the spin-offs convene to share best practices and wrangle over resources, which typically means people. Employees from one business are welcome to apply for permanent positions at any of the others, but poaching talent is forbidden. Some Maya employees want to start their own spin-offs. The staff gathers periodically to brainstorm ideas, and several employees have presented business plans. McManus says two of the plans sound promising, and he has put one of the aspiring entrepreneurs in charge of a large project to test his leadership ability. “In typical companies, when people aren’t getting enough variety or want to strike out on their own, they quit,” says McManus. “We hold on to our people and help them scratch that itch.” —Leigh Buchanan
To read how Grasshopper, a provider of virtual voice-mail systems, is using spin-offs to reach its goal of serving one million small businesses, go to www.inc.com/keyword/jul10
STRATEGY
Sales & Marketing A way to manage garbage at home Will it get a green signal from people? She is green. She means business. And boy, she will make your garbage rot like no other. Meet Poonam Bir Kasturi, a.k.a. Compostwali, who started Daily Dump in 2006 to help households convert their bio-degradable waste into manure, or compost. It uses a composter, called manthan, which is a terracotta tumbler with a capacity to hold around 300 litre of wet waste. Priced at Rs 8,000, inclusive of taxes and transportation charges, this unique device mixes household waste with saw dust, leaves and dirt, and forms a homogenous mixture. If it turns out too wet or dry—or, too stinky, for that matter—help is at hand through Daily Dump’s after-sale services at Rs 250 per visit. As an autonomous green worker, Kasturi supports word-to-mouth advertising—and competition. –Sunaina Sehgal
How would you sell that?
PITCH NO. 4: Create databases Raj Bhatia, founder, UCP Direct, a Bengaluru-based loyalty marketing consultancy “This is a niche product, and is likely to appeal to the environmentally conscious, well-to-do households. It can also be sold to resident/apartment owners’ associations (RWAs) running apartment blocks. Tie-up with newspapers to run contests on the environment, and use respondent information as a prospect list. A small demo film on YouTube will reach mass audience. If needed, gift one to a complex. Invite members of RWAs from across the city, give them a demonstration and strengthen the sales pitch by asking users to testify.”
COURTESY COMPANY
PITCH NO. 1: Seek political will Bindeshwar Pathak, founder, Sulabh International, a social service organisation in the sanitation sector “It’s the fundamental idea that drives an organisation. Waste disposal is not a popular topic. If Kasturi finds success in this sector, she will be breaking cultural barriers. Daily Dump needs to work on creating a ‘political will’. Persuade the state government and leaders to provide resources for waste disposal. It should seek the help of marketing experts to convince policymakers of its positive impact on the environment and economy. Also Involve women in its designing and decision-making.” PITCH NO. 2: Involve community Harish Bijoor, chief executive, Harish Bijoor Consults, a business consultancy based in Bengaluru “Banking on word-of-mouth publicity alone is not good enough. This ‘good-for-the-community’ product needs a quick and replicable sales model. And what better way to sell it than use the community to do so. Start by selling the product to smaller groups. Plant the idea in villages. Sell it on a community-ownership basis. Say, 40 homes fork out Rs 200 each to jointly own a manthan—a much smaller investment. Buyers can use it on a pay-per-use basis. Service visits could be funded from profits generated by the sale of organic manure.”
PITCH NO. 3: Sell the concept V Ramesh, founder and chief executive, Ecomove Solutions, a Mumbai-based company promoting eco-friendly vehicles “A progressive business idea; yet, the current word-of-mouth approach will not be enough. An amount of advertising is required. It should mainly target households, especially apartment blocks, or societies. Organise events and programmes in housing societies with people participating. Once their attention is caught, societies may be encouraged to sign up and buy the products. Also organise seminars and events on Earth Day with media promoting the idea. Use social networking site like Facebook and Orkut or, get people to blog about the venture. Business will scale up when people are aware.”
FEEDBACK ON THE FEEDBACK Holding a competition and using that data; letting people use it for free in groups; and giving demos to RWAs are do-able. We are already working on creating marketing material targeting children and households. We have consciously steered clear of policy-makers. Our approach is to slowly permeate urban centers, and overcome the social and cultural stigmas around waste. There is no real revenue in organic waste because of current policies on fertilizers. The key question is - “Do any of you compost at home?” If not, please let us help you do so, buy our products now! AUGUST 2010
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Elevator Pitch Gaboli manages alumni relationships. Can Rs 5 crore foster its growth?
OWNERS
Vineet Jawa Ashok Hariharan Tarun Varma LOCATION
New Delhi FOUNDED
2008
EMPLOYEES
6 full-time 24 contractual PROJECTED REVENUE
Rs 1.5 crore (2010)
SELECT CUSTOMERS
IIT Bombay IIM Bangalore (alumni association) XLRI Jamshedpur MICA Ahmedabad.
The Pitch “We build Web-based solutions for educational institutions and
professional associations. Our alumni management platform is a market leader in India, and we are launching tools for admissions and placements. We recently competed against five IT service companies in India and won a project to consult IIT Bombay on its online presence. Our cloud-based products are easy to use and cost effective. For the value segment, we provide consulting and implementation services for large-scale projects, such as networking sites for professionals. We are seeking strategic investment to tap international markets and expand our suite of products for the education industry.”—As told to Jacob Cherian and Sunaina Sehgal
FUNDING SOUGHT
Rs 5 crore
The Experts Weigh In SCALE UP
While this is an interesting idea, the key challenge is scaling up revenues. Most educational institutes may not want to pay per user, but pay a onetime fee. A strategic partnership may help here. Typically, institutes don’t have IT budgets. Selling to them is a complicated process due to multiple decision-making. There is limited differentiation from what I can understand— any IT provider can offer what Gaboli is providing. My suggestion is that the company should try and use an advance from customers to fund its operations right now, if possible. SUVIR SUJAN, co-founder, Nexus Venture Partners, Mumbai
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AHEAD OF ITS TIME
Most Indian institutions do not view alumni as a strategic stakeholder, and do not invest energy to engage with them on a long-term basis. For Gaboli to be successful, an institution needs to commit to building a long-term relationship with its alumni, without which, the sales cycles will be long and revenues lower for Gaboli. Given this, it will take a lot of time and capital for gaboli to scale up. However, if the team has had a different experience with the institutions than outlined above, we would be happy to evaluate it. Also, this analysis assumes that technology works the way it is meant to. BHARATI JACOB, partner, Seedfund, Bengaluru
PITCH NEEDS WORK
Gaboli needs to sharpen its definition of business. Right now, it sounds far too diffused in its scope. What is its business promise? If it is boosting online presence, then what happens if mobile becomes more powerful? The expansion to overseas markets is too premature and makes them vulnerable in an investor pitch. Has Gaboli signed 100 campuses? Do they have three-year contracts from any of the top 25 campuses on paper? These are more powerful influencers than the intention of becoming global. It seems that the Gaboli team lacks focus—they want to solve problems for many people in the immediate future. SATYANARAYAN R, founder, Career Launcher, Delhi PHOTOGRAPH BY SUBHOJIT PAUL
GUTTER CREDIT HERE
The Power of Networks Vineet Jawa, Ashok Hariharan and Tarun Varma are helping colleges get in touch with their alumni.
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Sales & Marketing Shop now, before it all disappears Businesses take advantage of vacant retail space to open temporary stores Pop-up stores seem to be popping up everywhere. The national retail vacancy rate is at a three-year high, so these temporary shops dropped into empty spaces have become an attractive option for both business owners and landlords. “It’s a great way to market your products or your real estate,” says Christina Norsig, CEO of PopUpInsider.com, a site that lists available pop-up locations. Here are four reasons entrepreneurs are opening pop-up stores.
Jason Revilla and Jim Grumbine were in New York City earlier this year when they stumbled upon some vacant retail spaces being used as pop-up stores. The two friends, co-founders of Faith & Fortune, a fledgling online apparel company, liked the idea and wanted to try someRetail Therapy American firms are using vacant retail spaces to put up totalled just US$150—plus a few T-shirts. The landlord let thing similar. temporary stores to market their the founders use the space in exchange for a couple of In April, after six weeks of products, or get rid of stocks. shirts. “One of the things we found in this economy is that planning and scouting locations, businesses are willing to help each other out,” says Revilla. the founders launched a pop-up “People are willing to negotiate, and it’s something you store for Faith & Fortune on a should take advantage of.” main drag in Beverly. Their primary goal was to raise brand awareness. “Since we’re a Web-based business, we were looking to 2. To unload old inventory get more people to interact with the brand,” Grumbine says. “It’s great having people come in and see the clothing, because the Two weeks before New York City’s International Contemporary Furmaterials we use are unique, soft, comfortable, and vintage-like.” niture Fair in May, Cheri Caso began hunting for space to exhibit the A friend in the real estate industry helped Revilla and modern house wares she sells through her online store, Merchant No. Grumbine find an empty store on a street with high foot traffic. 4. At first, she considered renting retail space, but she didn’t have much The space had wireless internet access. To publicise the event, the time to shop around, and the landlords she spoke with were asking for founders sent messages to their Facebook and Twitter followers thousands of dollars. Luckily, a friend who owns an architecture firm and handed out fliers around town. They used a laptop and an agreed to let Caso set up shop in the firm’s office. The company was online application from First Data, a merchant processing sergetting ready to move and had unused space in its fourth-floor loft. vice, to accept credit card purchases. In one weekend, the company Caso had two goals: to gain attention for her website during a sold US$1,000 worth of artist-designed T-shirts and sweatshirts; time when many design fans would be in town and to sell some US$200 of that was donated to a local charity as part of the compaproducts she no longer carried on the site. “We have a lot of odds ny’s dedication to charitable causes. After Revilla and Grumbine and ends that are just taking up space in our storage area,” she says. purchased signage, food, and office supplies, their costs for the event Caso spent about US$1,000 on the event, including US$200 62
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PHOTOS.COM
1. To get the word out
STRATEGY
for insurance, US$400 for the space, and US$400 for the materials she used to build display tables and room dividers. To get foot traffic, she announced the event on Twitter and sent press releases to design blogs and local publications. She also placed a sign on the sidewalk outside the building. Over four days, she made a small profit, with about 200 to 300 people passing through the shop. About a quarter of the products sold were clearance items. Still, Caso had hoped to sell even more. “Next year, it would definitely need to be in street-level retail space,” she says, “so I’ll have to start looking for something ahead of time.” 3. To test new markets
By 2007, Bobby Kim and Ben Shenassafar had built a cult following in Los Angeles for The Hundreds, a clothing company influenced by the styles of California skateboarders. Kim and Shenassafar had a store in the city’s Fairfax district and were looking to expand into other cities. Their first target was San Francisco. Opening a pop-up store seemed like a cost-effective way to gauge interest, so they teamed with several other brands to rent a gallery for a day. After the success of that pop-up store, The Hundreds opened a permanent retail space in San Francisco in 2008. In 2009, The Hundreds opened its own weekend pop-up store in New York City. The event turned a small profit, even with US$7,000 in costs. “Not only did we make a little money and move product,” says Shenassafar, the company’s CFO, “but we were able to market the brand in an area where we didn’t have a lot of penetration.” That persuaded Kim and Shenassafar to open a third store, set to debut in Manhattan this summer.
4. To vet a new business idea
For about a year, Dorie Greenspan, a popular cookbook author, and her son, Josh, had discussed opening a cookie shop in New York City. But permanent retail space in the city is pricey, they discovered. Before making a big financial commitment, the mother-and-son team wanted to make sure that people would come. “We needed to figure out if we could physically do this and if people would buy the cookies,” Josh says. In late 2009, Josh approached a friend who owned a Manhattan salon and pitched him on the idea of selling cookies there during the days leading up to Valentine’s Day. The friend agreed to let the Greenspans use the space for free. He merely asked that they pay the associated fees, if they used the salon’s credit card swiper. The Greenspans spent about US$1,600 to rent a commercial kitchen to bake the cookies and set up a small table inside the salon, near the entrance. A few fans of Dorie’s volunteered to help bake after she publicised the event on Twitter. Time Out New York and several food blogs covered the event. In six days, the Greenspans sold more than 4,000 cookies. “It was far beyond anything we expected,” Josh says. Not only did the pop-up prove that people would indeed spend up to US$3.50 on a single cookie, but it also convinced Josh that a full retail store was unnecessary. He is now looking to permanently rent a sliver of space in someone else’s store. “We had been thinking about getting a 1,000-square-foot space,” he says. “At the pop-up, we had a 3-foot table. It made me want to try to figure out a better solution where we don’t have as much space.” —Jason Del Rey
THE WAY I WORK | K Ganesh, TutorVista
“I am definitely a BlackBerry person; it intrudes into everything in my life.” K Ganesh, founder and CEO of TutorVista, has flirted with the successes and pitfalls of entrepreneurship long enough to know what makes a start-up hum. He has successfully exited three ventures in the past and is tasting success with his fourth, TutorVista. On a trip to the US, Ganesh realised there was a sizeable student population in the country which could be taught by Indian teachers, with modern communication technologies as the mediator. Born in 2005, TutorVista reaches out to millions of students, from the US to Korea. They are taught by teachers who work out of their homes in India. Ganesh spends his time on fund-raising meetings, tackling investors, and co-ordinating between two teams that sit on opposite ends of the world. His wife helps him run the India operations of the business. If there is something he cannot do without, it’s his post-lunch ‘power nap’.
AS TOLD TO JACOB CHERIAN | PHOTOGRAPH BY S RADHAKRISHNA
I hate waking up to an alarm clock. Thankfully, I can never sleep past 5.30am. On most
days, I am up by 5am. I drink a strong cup of coffee made by my mother and start checking my mails almost immediately after that. For the next half an hour, I make sure that I have responded to all the mails that require my attention. It’s important to do so since this is also the time when the US offices of our investors and partners close.
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High on Learning K Ganesh has learnt the art of giving critical feedback from Sunil Mittal and Shiv Nadar.
STRATEGY
My experience as an Indian entrepreneur dealing with clients based in United States has completely screwed up my sleep cycle. In the early days of TutorVista, I used to wake up at 2.30am, because all our teachers would also be waking up, ready for their students in the US.
N
owadays, however, I have a
little more time at hand. A little past 6am, I head across town, to the Koramangala Club, where I play about two hours of tennis. I started playing a little late in life, but have been hooked ever since. I’ve been doing this every morning for the past seven years. I have made some steady tennis friends and we’re highly competitive during tournaments. It’s funny how we sometimes squabble over points on the court. Compared to a badminton court, there’s plenty of chit-chat on a tennis court, simply because a tennis ball rolls, while a shuttle cock doesn’t. The time I spend there is highly therapeutic. Unlike golf, we don’t sit down and analyse the game later. Once we’re done, I shower and head straight to work. I sometimes play a set less, if I’m catching a flight; but I always play. It’s almost an addiction now. I get to work between 9.30am and 10am. My wife, who handles our domestic operations out of a separate building, drops off my lunch by then. I carry my breakfast with me, which is usually ragi or oats. I don’t believe in swipe-in-swipe-out timings for the senior management team. However, I am particular about it for the junior staff. I believe you can’t offer flexible timings at all levels of the organisation. Thankfully, I’ve never had to pull up anyone for work timings. As soon as I get into office, I take a round of the floor, just to say “hello”, and address issues, if any. There is a set of people who I have to talk to every day—my wife, for our India business, the team which handles online marketing initiatives, the head of our customer support team and the person who handles our relationship with Pearson, an investor in our company. My own role is mostly related to fund-raising, dealing with investors, planning new growth strategies and handling our online initiatives. By the time I log into my computer at work, I have already checked my mails a couple of times on my handset. I am definitely a BlackBerry person, which means this gadget tends to intrude into everything in my life. The tennis court is one of the few zones when it becomes silent. Before lunch, I usually take one phone call, and meet one person, like I interviewed someone for the CFO position yesterday. When I’m hiring someone, I steer clear of negative and pessi-
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“Post lunch, I nap for about
I snooze in mistic people. These traits become obvious when a candidate starts blaming his environment and colleagues for something that went wrong. The guy yesterday, however, admitted that he could have handled things a lot better. That is a sign of a great attitude. I don’t really look for successes. Instead, I try to see how the person tackled a problem. It’s also important to check whether the person will fit into an industry like ours that’s growing at such a fast rate. If the person comes with 25 years of experience in the automobile industry and tells me how he loves high-growth industries, then I know there isn’t a fitment there. On Thursdays, we have our weekly operations meeting, during which, we analyse all the metrics that are important to us, like traffic, conversion rates and average revenue per user. Every departmental head attends this meeting to enable short-term reviews and planning. This is usually followed by a weekly strategy meeting on Friday, which isn’t attended by as many people. Here, we brainstorm about new products and try to iron out long-term issues. The India school business, however, is subject to an annual meeting, in sync with the academic cycle. In one of these meetings, the team comes together and ideas get tossed back and forth. We believe in a lot of interaction with the customer. And that happens mostly over chat. Our team chats with about 40,000 people every day, so we constantly get fresh feedback. For instance, if we start getting requests from site visitors for a particular course, then we put together a small team to investigate its feasibility. I can launch a course on creative writing or Vedic math faster than any company can release a new FMCG product. For niche courses, which are priced at US$100, we usually want 1,000 candidates to start with. Otherwise, it isn’t feasible for us. For premium courses, like SAT and GMAT preparations, where we charge US$450, even 100 students are enough. I am always open to hearing other people’s opinions on my work, as long as they coincide with mine. Okay, that was a joke. But it’s kind of true. I am really bad with handling criticism. Or, so I hear. I know I don’t take it lightly. When I see criticism, I first look
STRATEGY
have to take a 30 minutes.
my chair.” to see if someone has an axe to grind. Then I tell myself not to shoot the messenger. I try to take it positively, but I still can’t take it lightly. My wife is my biggest critic. We’ve been married for 25 years, and she knows me really well. I’ve had the fortune of getting feedback from successful entrepreneurs, such as Shiv Nadar and Sunil Mittal. When you’re getting criticism from such people, it’s an honour that they have taken the time to notice you. They have taught me a lot about the art of criticising. The first rule is not to talk down or criticise the person. Instead, criticise the process. Then, ensure that you cushion it well. You can always put a positive spin to the feedback. Finally, offer a solution or an alternative to the problem.
W
hen I was reporting directly to Sunil Mittal, if I did something wrong, he would sit with me till late in the night and show me how to get it right. I used to be so embarrassed about the boss doing my job that I would make sure that nothing went wrong the next time. That’s how it should be. I got my entrepreneurial aspirations from Nadar, and the passion to get into Greenfield industries from Mittal. Even 10 years ago, Mittal’s take on the Indian telecom industry was “don’t worry about what the market size is today, look at what it can be”. Today, we have 20,000 students in the US, and around 60 million students in total. Every kid needs an education, and we can expect to see immense growth in the coming years. TutorVista is four-and-half-
years old now. For the first three years, we had less than 400 teachers on our rolls. Then suddenly we had to go up to 2,000 teachers in one year. A singular focus on the end goal is extremely important, especially for new industries like ours. And this is the favourite part of what I do—creating something that didn’t exist before. I usually have lunch alone, at my desk. I’m pretty strict with myself when it comes to healthy food. I prefer carbs, like brown rice and dhaniya, which are rich in fibre and make me feel full for a lot less. Between breakfast and lunch, I drink a couple of coffees and one fruit juice. Post lunch, I have to take a nap for about 30 minutes. I lock my door, mute my phone, tell my assistant to hold all calls, put my feet up and snooze right there in my chair. If the time between 10am and noon is most productive for me, then post lunch is definitely my least. I need my power nap. I sleep for a total of about six and a half hours, including the power nap. By 3pm, I’m back at my desk, charged up on caffeine. I usually have a meeting at 4pm. Thereafter, up till six in the evening, I am sending mails over to the offices of our US-based partners and investors so that they get to read them at the start of the day. Around this time, my wife will have finished work at her office and driven across town to mine. She works from here for about an hour. She’s really good with people, setting targets and microdetails of execution. We both leave work by 6.30pm, driving back home in our own cars. When I reach home, I like to spend time with my 11-year old son. We go down to the clubhouse and play some badminton, or maybe cricket in the garden. We’re both cricket fanatics. My daughter is studying economics in Singapore. I like to tell my children—and my team members—that never say “I will try”. Either a person does something, or not. I also advise them against doing anything half-heartedly or taking half measures. If you enjoy what you’re doing, then you will always be good at it. Success to me is about doing what you enjoy, as long as it affords you that certain standard of living. Between 8.30pm and 9pm, the whole family—that is my mother, son, wife and me—has dinner. Tonight, however, we will be eating out, something we were supposed to do yesterday, but I had to cancel it at the last minute because of an urgent call. Modern communication technologies have made our lives more complicated and one needs to be really disciplined to manage it. After dinner, I have to get my dose of fiction. I’m currently reading Jeffrey Archer’s Short Stories. I’ve got plenty of non-fiction, but quite frankly I almost never finish them. I’m very good at buying lots of books, but not so good at finishing them. I usually start winding down after flipping through a couple of pages, or surfing through the television channels. I reflect on the day that has passed, feel light thinking about the tennis court that awaits me in the morning, lean over and switch off the light. I’m off to sleep by 11pm.
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I WISH I KNEW THEN...
Amarjit and Gunita Singh
The couple started out in 1989 building exhaust fans for ‘original equipment manufacturers’ (OEMs). Their first factory in Delhi was based out of a humble 300 square yards space. Since 1990, when they raised their first bill, the Intec Group has grown from an annual revenue of Rs 6 lakh to Rs 190 crore across four companies. The business has expanded—and how. The first-generation co-prenuers ponder over things that could have been. We started out quite young. Neither of us had a professional degree—especially one in business management. One of us should have studied more, perhaps, even got an MBA degree under our belt. It would have made us better at business. We wish we had gone to better educational institutions. As parents, we don’t wish to repeat the mistake, and therefore, have ensured that our daughter—just a year older than our business—gets the best education and has no such regrets. On the business front, we could have started manufacturing air-conditioners much before 2002, may be as early as 1995. That’s the business that helped us scale up. Maybe, we could even have avoided the diversification into multiple products, such as water heaters, exhaust fans and plastic containers. The irony, however, is that we discovered the market potential for ACs while diversifying. Today, Intec manufactures around 160,000 air conditioning units per year; and, we hope to raise this capacity to half-a-million by 2012. We could have taken on a third partner, which we didn’t, mostly because we had each other, but also because an astrologer asked us not to. That, in some way, impacted our personal lives. We were so involved in our business that we did not expand our family. Our daughter should have had a sibling. Given that we live in a society obsessed with male
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However, we also realised that we needed to separate our family and professional set-up. Once a family business touches a certain revenue mark, it needs to become a lot more professional. For us, that milestone came in 2002-03, when we signed up with Samsung. We also learnt a lot along the way from our partners. Koreans taught us to work round-the-clock. We changed a lot because of that. When we first started to work with Samsung, we could barely manage to manufacture 200 units in a day. Samsung taught us to build 300 air-conditioners per day. Today, we make 1,000 Learning Through Errors Amarjit and Gunita Singh discovered their niche by diversifying units. Like Indians, the Koreans are tenacious and intelligent— heirs, it’s not surprising that people point out and know where and how to spend. They are that we don’t have a son. However, as our extremely goal-oriented and can be ruthless employees remind us, we have 500 sons in while firing a person. At the same time, they them. We’ve known some of them for years— would probably touch your feet, if they need one of our current team members signed up to get something done. Looking back, we when we were just a Rs 12-crore company. believe that we spent too much money on Today, we’re nearing the Rs 200-crore mark. the business itself. We should have saved In our early days, we couldn’t offer poten- more.—As told to Jacob Cherian tial employees large pay packages. So, we substituted for that with a homelike environment. We took people in and made them family. PHOTOGRAPH BY SUBHOJIT PAUL
Everything you need to know to run your business in today’s economy
: : : : : : : : : : : A MONTHLY GUIDE TO POLICIES, PROCEDURES, AND PRACTICES
REMOVE BOOKLET ALONG DOTTED LINE
07
KEEP TABS ON COMPETITION You may cringe at the idea of snooping, but in this dog-eat-dog world of business, it pays to know what your competition is up to. This is where competitive intelligence (CI) comes in—a term used to describe the practice of gathering and analysing leads about rivals’ products and services, strategies, cost structure and pricing. That’s not all, though. It is also about keeping a tab on the external business environment in which you operate. CI allows you to rely on facts to get ahead in the race instead of developing strategies based on guesswork. In short, it is an essential part of the fabric of successful enterprises. Irrespective of whether you’re looking to defend your turf, or preparing to fight for your competitors’ territory, arm yourself with CI. The best part? Though the big fish may have entire departments devoted to CI, it does not require a neat packet or a lot of time to sleuth around. So, read on if you’re keen to inflict some damage before you feel the heat. Our panellists share a few cost-effective ways to get a head start—before someone else can spring a nasty surprise on you!—Charu Bahri
VOL. 01 NO. 07 | INC.INDIA GUIDEBOOK
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KEEP TABS ON COMPETITION : : : : : : : : : : : : :
KEEPING TRACK OF RIVALS 1
Lay the Groundwork
Determine who matters: The first step is to determine your competitors. They are most likely to be similar-sized firms engaged in the same space as you. However, you don’t need to track all of them. If you’ve come up with a long list of rivals, narrow it down to the top five. Though gathering intelligence is neither too time-consuming, nor expensive, pointed efforts will yield the most useful outcome and make the most of limited resources. Focus on your business ecosystem: Look beyond your rival firms. After all, your bottomline doesn’t just depend on sales revenue. Controlling costs of raw materials and other inputs goes a long way in increasing profits, too. Therefore, experts advise tracking suppliers, and in certain cases, clients’ competitors. Rohit Sabherwal, head, business development, Centre for Monitoring Indian Economy (CMIE), admits that his centre is frequently approached to track clients’ suppliers. “When faced with the choice of selecting one of multiple suppliers, clients wish to understand each potential supplier’s profit margin, so that they can improve their bargaining position. Having a clear perspective of the margins helps negotiate competitive input prices,” he explains. Public relations specialists and consultants also benefit from knowing the ins and outs of their clients’ competitors. Subhash Pais, business head, i9 Communications, a public relations firm, says “This helps guide clients and cement the relationship further.” INC.INDIA GUIDEBOOK | VOL. 01 NO. 07
Formalise the process: Once you’ve pinpointed who you need to monitor, you’ll be in a better position to decide if you can do it yourself, or you need someone else to do the dirty work for
Gathering CI is neither too timeconsuming nor expensive. you. The decision will depend on the potential source of intelligence. For instance, if you want information gleaned out of reports in the public domain, then it makes sense to avail the services of specialised analysts. At CMIE, for instance, experts frequently help clients in the FMCG sector understand their competitors’ financial performance, and determine key drivers of profit and growth. “Higher profit and growth may be traced to increased profitability or growth in volumes, or indicate better liquidity and inventory management,” explains Sabherwal. Such information can help clients benchmark expected performances, and gain a clear perspective of the future dynamics of an industry and their rivals.
Delve into Your Rival’s Mind 2
Follow news feeds: While tracking online reports may be the more obvious sleuthing method, there are discreet ways to go about it. “Keep a tab of the online news feeds. And sift through
reports in trade publications regularly,” advises Shekar Nair, CEO, Elina Networks, an IT networking company. Nair recommends Google Alerts to get the latest buzz on products being launched and marketing strategies being planned. Google constantly trawls through information posted on the web. As and when it finds a new page containing the key word (or words) that you have set an alert for, it sends you the relevant link. Nair uses Google Alerts to work out competitive prices for his product vis-à-vis his multinational competitors. He points out that MNCs, which are operational in countries laying out strict norms for suppliers to government departments (such as US), are required to post charts detailing product features and pricing online. “Since the information technology space in India is a fair playing field for both start-ups and MNCs, Google Alerts helps me find pages containing my competitors’ overseas pricing details. Once we know what our competitors are charging overseas, as import customs and duties are fixed, we can make a calculated estimate of their prices in India,” he explains. Hire mystery shoppers: If you’re engaged in the retail sector or in the service-oriented space—such as hospitality or financial services—you will benefit from hiring mystery shoppers. As Saurabh Kumar, director, client solutions, Grassroots India, a business performance improvement company, points out: “Mystery shoppers sent to compet-
itors’ service outlets help expose best practices.” They can help find the areas where competitors score higher—and do a bit of sleuthing in your own turf. Send them to multi-brand outlets to gauge how salespeople perceive your brand, and whether your sales attendants are doing a good job, or need further training. As Kumar concludes, “Knowing how your product stacks up is the first step. Once you have identified the shortcomings—vis-à-vis the competition—you can work on identifying an effective solution.” Deploy technology tools: The web and television have emerged as powerful advertising tools. “These are the best
ways to receive updates on competitors’ online and on-air strategies,” shares Arnab Mitra, director, MediaContacts, a subsidiary of Havas Digital, a leading global media conglomerate. Teams of analysts at his company frequently search the web for news related to competing media agencies and their client accounts. Primetime television commercials are also mapped to the channel’s TRP (at respective times) to determine the efficacy of campaigns, and formulate appropriate counter-strategies. Web tools, such as “Who is?” that lists information on site ownership, are utilised to find out which firm manages what, and accounts that rivals may be secretly working upon.
3
Act upon Leads
Tracking rivals is only the first step to getting ahead. Once you know exactly how your product or service measures up, says Pais, take a hard look at what needs to be changed to become more attractive to the target audience. However, “don’t even think of aping your competitors’ strategy; instead, work towards improvising on their best ideas,” he cautions. Experts also suggest resisting the urge to compete on price. However tempting it might seem, cutting prices to increase market share is not a viable long-term strategy. Instead, focus on providing greater value. Sooner or later, products and services that add the most value emerge as the market frontrunners.
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KEEP TABS ON COMPETITION : : : : : : : : : : : : :
GATHER INTELLIGENCE THROUGH NETWORKING
Networking with potential sources of intelligence may prove immensely useful. Elena Network’s Shekar Nair suggests encouraging your staff to gather customer intelligence at every possible opportunity through better listening and building trust.
Prospective clients: Every client studies the market before narrowing
down its choice to one or a few providers. So, it has a good understanding of products and services on offer. “Marketing people are best positioned to gain valuable information from prospects,” suggests Nair. Clients: If your service personnel share a positive rapport with clients,
especially with those patronising more than one brand, they can learn about the superior aspects of your competitors’ products and services. It may pay to train your staff to ask the right questions and develop the attitude towards networking. Channel partners: Channel partners are an invaluable source of
intelligence, such as sales leads naming clients that rivals are trying to whisk away from your portfolio and leads about potential large orders.
NOTES:
COMPARE YOUR WEBSITES Your website reveals as much about your brand as your rival’s does. Compare your respective websites to determine if you have omitted sharing information of interest to your clients. This could include information about your product, or a useful public forum for clients to post queries about product usage, or a blog to keep your clients abreast of product updates. An interactive website can be a means for you to show you care about communicating with your clients—present and prospective. Some business verticals that require a strong online presence, such as online retailers, could also benefit by comparing the quality of navigation, layout and content on their website with that on their competitors’ sites. If you’re losing online sales to your competitors, it may pay to bring onboard a website designer to redo your site.
Resources
To download Grassroots India’s Are You Being Sold? Report, visit http://
www.grassrootsindia.in/bdr-emp2/gruk/ content.xhtml?contentName=AYBSold
Look up domain names at http:// whois.domaintools.com or http://www. whois.net/whois/ The Centre for Monitoring Indian Economy’s Prowess database of large and medium Indian firms contains detailed information on over 23,000 firms at http://www.cmie.com/ database/?service=database-products/ firm-level-data-services/prowesscorporate-database.htm
INC.INDIA GUIDEBOOK | VOL. 01 NO. 07