229 / October 9, 2023
Did Jio SAVE India, Bharat’s BIGGEST FLAWS & Helping Indian Farmers | BigBasket Founder
This week’s episode is an CAPTIVATING look at how Jio changed India forever, the flaws that Bharat as a country has & how BigBasket has empowered farmers as we welcome V S Sudhakar, co-founder of BigBasket, to the Neon Show!
How Did Mukesh Ambani Change India Forever?
What Weaknesses Does India Have As A Country?
Does BigBasket Have Any Benchmarks For Profitability?
“We See Education Not As A Barrier, But As An Enabler At BigBasket.”
All these riveting topics and more in this PLEASANT & INFORMATIVE conversation. A real look into the hidden brains behind BigBasket’s success & a man with a golden smile… Tune in NOW!
Watch all other episodes on The Neon Podcast – Neon
Or view it on our YouTube Channel at The Neon Show – YouTube
3 Lessons Learnt From V S Sudhakar | A Newbie’s Perspective
1. Process Orientation Is One Weakness India Needs To Overcome
While India as a whole has rapidly shown improvements across multiple sectors, Sudhakar sir believes that the country lacks discipline when it comes to looking at holistic problems from a “process view”. Not just in business & entrepreneurship, but in all aspects of life. If this improves then India will be right up there with the likes of Japan & China!
While the introduction of JIO changed India for the better, it is the fact that they brought the prices down severely that revolutionized the country. Making JIO accessible to not just tier-1 and 2 India but also to tier-3 cities ensured that India as a whole grew over the last 10 years. This caused other service providers like Airtel to do the same and made the internet as a whole accessible to nearly a billion people!
VS Sudhakar 00:01
Started with books, then went on to music, then went on to grocery then went on to jewellery when we did everything.
VS Sudhakar 00:09
Those days, it was one of the biggest checks for a startup.
VS Sudhakar 00:14
And it was fantastic journey.
VS Sudhakar 00:19
Sometimes you could be just running the race without really knowing for sure whether you’re running the right direction, or not good to sometimes stop figured out.
Siddhartha Ahluwalia 00:29
Hi this is Siddhartha Ahluwalia, and welcome to the Neon Show.
Today, we are joined by the co-founder of India’s largest online food & grocery store.
His startup journey in ecommerce began in 1999 with Fabmart.
But he soon realized India was not ready for it then.
12 years later, the founders of Fabmart came together to create another online grocery store.
This store… came to be known as Big Basket.
We welcome V S Sudhakar sir on the Neon Show!
*I would also like to thank our sponsors Prime Venture Partners for sponsoring the Neon Show.
Hope you enjoy it.
Siddhartha Ahluwalia 00:29
I would like to first start the podcast by going to your childhood, right? What are the memories that you remember where you grew up? And about your parents?
VS Sudhakar 00:37
Okay. So,if I look at my parents, in fact, very interestingly, my father was the very cool cat in that sense. I mean, never would say ….
Siddhartha Ahluwalia 00:49
(Sidharth Interupts) Borrowed you’re coolness from him?
VS Sudhakar 00:50
(Chuckless) I would love to believe that I’m as cool as him. But the point is, he is a very, very cool person. My mother was very disciplined and very focused on discipline.
Siddhartha Ahluwalia 01:03
Usually, it’s the opposite, right? mother whenever (Inaudible)
VS Sudhakar 01:05
I know that that’s why I said very, very rarely would you get this combo. So, in a way it worked very well, because a woman being the harder one is always going to be softer than the man being the hard one. Right. So therefore, fathers being the softer
VS Sudhakar 01:21
set, or the softer partner makes it that much easier for the children. So we are a fantastic childhood. I mean, both between my father and mother, the whole environment was always very comfortable.
Siddhartha Ahluwalia 01:35
So, you’re born in Bangalore?
VS Sudhakar 01:37
No, no, I have not been in Bangalore. Till 95. I did one stint prior to that. But I was actually born in Chennai.
Siddhartha Ahluwalia 01:45
VS Sudhakar 01:45
And what I did my my father was in the railway. So before we used more on quite a bit, not too much, Mumbai. So after I was born, we’ve moved to Mumbai.
Siddhartha Ahluwalia 01:56
VS Sudhakar 01:56
And then to Hyderabad. Then my father was in Vijayawada then I’ve been doing my engineering from,
Siddhartha Ahluwalia 02:02
VS Sudhakar 02:03
VS Sudhakar 02:04
When did engineering. So engineering in Allahabad, then worked for two years in DC and then went to Ahmedabad. For my, so I’ve been moving around quite a bit, too.
Siddhartha Ahluwalia 02:14
So by the time you graduated in 1984, from IIM..
VS Sudhakar 02:18
85, I graduated from IIM Ahemdabad.
Siddhartha Ahluwalia 02:21
and you, were already i believe 26,27 by then?
VS Sudhakar 02:29
yeah!! I was 25, 25nd a half.
Siddhartha Ahluwalia 02:32
So, at that point of time.You, choose to go and work for startup at that point of time right? TVS?
VS Sudhakar 02:34
stage was a startup and not a startup. So the interesting thing was TVS group, obviously, very, very well established, established group has been around for years. So they were looking at known auto areas to see if there is an opportunity to do something different. And that’s really where I joined this small team of just three of us.
VS Sudhakar 02:53
So it was interesting, I think I actually don’t even remember where I came across this. And at that point of time, my parents were in Chennai, and my parents were very keen that I should come and stay with them. I said, if I get a good opportunity, I’m happy to do it.
Siddhartha Ahluwalia 02:53
And wasn’t it a campus?
VS Sudhakar 02:55
Siddhartha Ahluwalia 02:55
Was it a campus placement?
VS Sudhakar 02:56
No, it was not a campus placement. It was an off campus place.
Siddhartha Ahluwalia 02:59
How did you choose? (Chuckless..)
VS Sudhakar 03:00
So, then there was something called Granville locks, and there was something called grandma’s seats. So car seats, then we did electronics, which is really what I focused on. So the interestingly varied set of things that we were looking at when we were looking to get partners in so that we can get the technology and because that’s typically the manufacturing bloodline was very strong in TVS, right, because they have been manufacturing for very, very long,
VS Sudhakar 03:11
And this opportunity, when I spoke to Mr. Kubal Sreenivasan, it sounded very interesting, because he was just saying that we’re going to do something from ground up, and absolutely nothing on the ground. And literally, the three of us focused on different areas that we could look at. So for instance, the the kind of range of things that this team of three, we did one was a whirlpool, right, the type with Whirlpool, which was the TVS Whirlpool, which is now Whirlpool.
Siddhartha Ahluwalia 04:13
I believe you have the appetite for range. If you you know, you have read the book called range by David Epstein.
VS Sudhakar 04:18
Siddhartha Ahluwalia 04:19
so, so, talks about why generalists will score more in a specialised world, and they’ll do better.
VS Sudhakar 04:25
Siddhartha Ahluwalia 04:26
So, it talks about right. The thing you mentioned that you were looking for range, somehow. And that theme continued right. Among the five cofounders. In big basket, you was the one who had the maximum amount of range?
VS Sudhakar 04:39
Range many Yeah, a range of work. You’re saying yeah, more importantly, I would say open ended thing Tiyaan always used to say that, you know, he’s used you have very carefully in breeze cleverly picked the best job in the company. So you always used to say, you seem to learn the max joy out of all of us because you pick the right job for yourself. So, yeah, I like unstructured something where you’re you’re building, you’re, you’re doing something different. You’re saying doing something new, always been very exciting.
Siddhartha Ahluwalia 05:14
But at the same time, you’re the one who’s the most process driven?
VS Sudhakar 05:19
Where did you pick that? Up, but you’re right upset, because I’ll tell you, it’s a very interesting thing. And in where this process thing came in very strongly, and something which I really believe in now. So, you know, in 95, the I was working for this, again, another kind of startup called Microline. And I was heading the north and the east divisions for Microline. And at that point of time, I got an offer from a company called Ungerman bass networks, which was a network technology company based out of the US. And the role was that of a country manager. So I said, so when I was telling Pradeep Kharr, who is the founder of microline. So he told me, You tell me, what is it that we should do, but I don’t want you to go, I told him, I will go, and I will come back. I need at least two years. And I said, this very simple thing that I want to figure out.
VS Sudhakar 06:16
If you look at an MNC in those days, at least, and it’s true, even today, those guys would work five days, no Saturday, no Sunday, people work only that many hours. Whereas we used to work, 10 hour’s 12 hour’s was six days, six and a half days, and it they make more money. So there must be something these guys have correct. I’m gonna go figure out what that is. And I said, I’m happy to come back. And maybe we’ll help do things better. So what I learned with critical pieces, in fact, one of the things when I joined, my boss told me, ask for whatever infra you want. Don’t ask for more people. So people, getting additional people is the most difficult thing. But if you look at an Indian context, the easiest thing you will get us the people what you won’t get is the infra or you want to invest in the latest info, we have to think about it, we own 10 more people, no problem statement. The point is exactly the reverse. They said, he said, Don’t ask for more people very difficult to get as for whatever in frame one. So two things they really focus on. One is create very good infrastructure, what that means is what works works, so you don’t end up wasting time because the virus lose, look at the amount of time you all spend because something doesn’t work, right, you can go around trying to fix it. Just imagine if my if all that goes away, my productivity will just zuba that’s the first part. Second is extremely process driven. A process once it’s set, it’s set, you can’t gently play around with it. That’s the only way I realised that when you build scale, you can’t build scale without process. And process is not what you write on paper. And people talk about a process, people have a nice, you know, either a project sheet or a process sheet or Excel sheet which talks about the process, it is whether you execute it on ground. When you execute it on ground, you can feel the difference. So when I at the end of two years, I realised if I really get it down to the basics, these are the two things.
And if you really look at in an Indian context, one of the weaknesses we have as a country is our process orientation. Right? Very poor process orientation. So if we change that, in my view, I think that itself will be a big change for the country. Because I think we have the intelligence we have the capability
Siddhartha Ahluwalia 08:55
VS Sudhakar 08:56
Hard working, it’s just that we lacked the discipline and the process orientation.
Siddhartha Ahluwalia 09:01
learning Japanese excelled at it.
VS Sudhakar 09:01
VS Sudhakar 09:03
Absolutely top class
Siddhartha Ahluwalia 09:04
And the Chinese copied it exact manufacturing.
VS Sudhakar 09:08
So I think process orientation is a process orientation is not just about manufacturing or at work. process orientation starts in everything you do. Right even at home. For instance a simple thing like following traffic rules. I mean, if there is a queue of cars, right you know that there is something which is blocking the thing if three more guys go around you you’re going in making it worse. Yeah. Just a simple process orientation will be make people think that if I do that, I’m going to make things worse while I think I may get away faster, but overall everybody’s going to spend more time simple you know things like that. Basically is the process orientation or up basic sense of process right? If we get that so I realised those are the two things so actually after two years probably being predict called me exactly the end of With his boss, docile hoga So is it true? So I said, if there is anything interesting and happy to look at it, and as luck would have it, that’s the time when a woman boss networks was being bought over by a company called Newbridge. And they were wanting me to shift to Singapore. Okay, so I told him see, give me something interesting. I’m not very keen to go out. So I’m happy to look at it.
So before he was just looking at, he just started with, just imagine this is 97. Okay, when Internet itself was just very small, too early, right? So we started an internet services company for Indian clients. And we started building internet based solutions. So he said, Why didn’t you come in,and run the company.
Siddhartha Ahluwalia 10:50
and dial up internet was the No,
VS Sudhakar 10:53
Only dial up. There was no question of anything else. So and in fact, I remember talking to somebody the other day when they were asking me questions about that. So, you know, one of the key metrics that we used to track was, what would be the page download time? You won’t believe it. It used to be a struggle to get it to 4550 seconds, just imagine you click 4550 seconds will take for the page to refresh
Siddhartha Ahluwalia 11:20
that was teaching people patients Exactly. Just imagine today,
VS Sudhakar 11:24
two seconds, people will get very impatient, right? So But technology was like that, and the fact that it was so new, so different. I think people just got so carried away by the fact that this is something which is cutting edge.
Siddhartha Ahluwalia 11:39
I think Sify was one of the market leaders in India bags. And exactly, they had the Pacific broadband, for businesses and for individuals.
VS Sudhakar 11:48
That used to still be very expensive,
VS Sudhakar 11:48
And would provide still very little bandwidth. So it used to be a huge struggle. So in fact, when people ask me, What’s the difference when we did fab mart versus when we did big basket, the single biggest difference is the technology. I mean, that just bandwidth availability speeds at completely different ..
Siddhartha Ahluwalia 11:51
than the mobile?
Siddhartha Ahluwalia 11:51
VS Sudhakar 12:24
And the mobile came later. Mobile didn’t come in 2011. And when we started, right, because then it was just getting, because we only when the smartphone started coming in, right, that’s when the whole concept of phone as a browser really came into play. And that came a little later. So in fact, interestingly 2016 or 17 till about 16-17 80% of our business used to come from our website,
VS Sudhakar 12:36
20 person used to come from apps and within a year it went to exactly the reverse 28 the
Siddhartha Ahluwalia 12:49
VS Sudhakar 12:50
Unbelievable, just that whole transition happened within two years.
Siddhartha Ahluwalia 12:54
So it was amazing. And all because of one man Mukesh Ambani
Siddhartha Ahluwalia 12:57
VS Sudhakar 12:57
literally Yeah, in fact, I agree with you. I think I still remember there was this ad which they put up way back, which said that at some point in the future, Dhirubhai Ambani is dream is that even rickshaw Wallah will be having a
Siddhartha Ahluwalia 13:17
VS Sudhakar 13:18
smartphone. And this is like we heard of smartphones. I mean, that’s vision. So you really, I mean, you need a visionary to drive something as large as this
Siddhartha Ahluwalia 13:30
visionary in a country like India, everything right to have in your pocket to drive a change like that.
VS Sudhakar 13:37
True, but I think one can always kind of look at the negative sides of it. But the reality is, you still need that vision. You need the dream, you need the drive, you need the energy. And without that you can’t execute, right. So they executed amazingly well.
Siddhartha Ahluwalia 13:55
They have executed they’re out competed, everybody.
VS Sudhakar 13:57
Yeah,I mean, the out competing part’s where people can have their crips but the fact is, I think they brought the price down because of it. Everybody else brought the price down and fortunately, an airtel survived and still making money, good money, and they are also providing the services the same same price and that is changed the whole country. Right.I mean, that’s quite.
Siddhartha Ahluwalia 13:58
The UPA wouldn’t have happened without that .
VS Sudhakar 14:10
Without it UPA wouldn’t have happened a lot of things gonna happen. I think it’s a it’s a phenomenal change in technology landscape itself, because the
VS Sudhakar 14:27
EdTech boom couldn’t had happened?
VS Sudhakar 14:29
everything, all of it. Ecommerce, it says, I don’t think e commerce would have boomed as much as it does. Without that one big revolution that happened. That was a major revolution.
Siddhartha Ahluwalia 14:40
Ecommerce, you can also attribute to the initial starting by Flipkart buy big basket, and then the Walmart Flipkart deal. Right. It became the largest acquisition in India
VS Sudhakar 14:50
Flipkart Walmart deal. (Chuckles) what it did was, I think it suddenly opened the gates to start. I think suddenly a lot of people said Oh, wow, this is like big money. Yeah. Right. So, but I think it did both did good and bad, because I think it also suddenly made it look like the primary reason you do a startup is because you’re going to become a billion dollar company, which in my view is fundamentally a very lopsided approach to life. I mean, if you’re seeing, the only reason I want to do this is because I think I may potentially make a billion dollars. Not at least,
Siddhartha Ahluwalia 15:28
VS Sudhakar 15:30
Not exciting. That’s not necessarily the reason you should, money should be a byproduct. Money should not be the main product, right? Money should always be a byproduct. The main product should be the passion, the excitement, the energy, that you get into what you do. And I think that’s really what drives you. Right? That is really what gives you joy. Money is, is obviously very good to have, right? Nobody
Siddhartha Ahluwalia 16:00
It gives you freedom!
VS Sudhakar 16:01
It gives you freedom later once you get it. But till you get it, if that’s your primary goal, it really,I think, shackles you.
Siddhartha Ahluwalia 16:09
Till then if you are you are a slave of it.
VS Sudhakar 16:10
exactly. Exact and shackles you.
VS Sudhakar 16:13
So it’s a it’s a very important thing that money is obviously a driver, nobody can say that, Oh, I don’t care for money, right? Some people can, I’m not saying no to that. But I’m just saying it should be a secondary goal, or a byproduct, not the primary goal or the primary product, then then I think life becomes very, which is why one thing that I always tell startups, when I have an opportunity to talk to them when they say no, what should I do? Always say first understand whether is this something you’re going to enjoy doing? Right? Is it something for a second, don’t even worry about is the biggest thing is going to give me billion dollars? Is this going to be you know something where I’m going to make tonnes of money? Because the moment that becomes your primary driver? I’m, I’m not saying every case, you will do it. But there is a higher probability of making mistakes. Because then you’re doing something for the sake of the money not because it’s something innate to you something that you will enjoy do it. For me, the I think the joy that you have in a startup journey is really something that you should never, never compromise. Because if you don’t get that, even if you get the money, I don’t think you’re a porter,
Siddhartha Ahluwalia 17:27
who better than to understand from you and the co founders or bigbasket, you guys have given 25 years to one space. (Chuckle’s)I don’t know anybody, if at least in internet, India, who has given so much to just one space.
VS Sudhakar 17:42
Yeah, I guess. Yeah. In fact, many times we always feel I think we have way past our expiry date.
Siddhartha Ahluwalia 17:50
What you mean by that?
VS Sudhakar 17:51
What I mean is, we are all quintessentially startup guys, right? You know, the scale that we’ve reached today in bigbasket, is not something that we ever thought we want to be in, because that’s not really what, but I think why it still gives us the kicks, it still gives us the excitement is the fact that we still view it as a startup. So which is why when.
Siddhartha Ahluwalia 18:12
even at $3 billion.
VS Sudhakar 18:13
100% can we we for us, which is one reason when you guys say, you know, you guys are done. So okay, fine. I understand broadly. But when I walk into the office, I don’t think it’s any different from where it was 10 years back, because I think the challenges are different. Because scale brings its own set of challenges in, you know, issues which you need to tackle. As a startup, your challenges are very different, right. But your thinking process still has to be first thing like I keep saying I don’t think I’ve said it some 100 times already. So pardon me for saying that. But I think first thing is stop taking yourself seriously, because the moment you, I think where a lot of people go wrong in their heads is when they start thinking No, I’ve made it now. I’m a big guy. I’m a large guy at scale. So which means success equals greatness. I don’t think so there are great people who have not succeeded. Because I think there’s a lot of luck, which is required, you have to be the right time at the right place. Right. And a lot of things have to fall in place. Because anybody who says I’ve become successful purely on the basis of my merit alone, I think, fooling themselves because I think God has to be with you and you have to have a lot of luck. Whether you call it luck, God fate, whatever you want to call it. I think those have to help you. Without that the best of guys who are doing all the right things can still lose out.
Siddhartha Ahluwalia 19:44
Can you give me example of people who you think are like highly great, but haven’t achieved success?
VS Sudhakar 19:50
I don’t know. I mean, off the cuff. If you’re asked me to name somebody, I’m not able to put a name or think to it, where I’m coming from I’m looking more at the fact that, you know, many times there are twists and turns and you know that that quiz could have gone. I’ll tell you my classical example of this is going back to my good old cricket example, like, when you’re on the in the T 20. World Cup when the last over Dhoni had to figure out who to give it to you. Right? He took a massive risk, right? If the risk paid off beautifully, so everybody said he’s a genius, but look at it slightly differently. If he had got back for a sixth, what would have happened? Don’t he would have just got berated and would have most likely. So for all, you know, that could have been a turning point in his life. It was a turning point in his life. Fortunately for him, it worked out. It may not have worked out also if it didn’t work out, you wouldn’t have had the Dhoni the captain that everybody.
Siddhartha Ahluwalia 20:50
It was very early in his captain days.
VS Sudhakar 20:51
Exactly. That’s what I’m saying. So if he had, if you had got droped from the captaincy, because of that, then you never know. See, what I’m saying is events can just shape your life like that. And therefore where I’m coming from us, I’m not talking about success versus failure based on the fact that, but it can success or failure can easily get affected by one or two events, or three events or four events. And they are happening over a period of life, right? So therefore, I think luck, or fate, or God, play a very key role in in success. So one thing, therefore very critical for anybody to realise, just because you’re successful, suddenly, it’s not because you become the wisest guy or you’re a genius, you’re not. Mean you are exactly who you were 10 years back, nothing is me, you learn more. And you definitely learn from failures. And you learn from mistakes you make. So therefore, I think the fact that we’ve been in this for too long doesn’t necessarily mean that we are some great guys who have who know everything about internet, we don’t,
Siddhartha Ahluwalia 21:53
but spending 25 years, right? Do you attribute some part of it that you know, you you gave it your all for a long period of time, so it had to happen?
VS Sudhakar 22:05
That goes without saying we have given it all? Right, no question about it. I think we have we’ve given a lot of energy, a lot of our insights. But we’ve enjoyed it. In my view, that’s very critical. Don’t get stressed out by it, I think enjoy the journey. There’ll be stress points, there’s no question about it. But most days should be good. Most days should be fine. Most days should be enjoyable. I think it has happened for us. And that is what really keeps you motivated to keep coming back next morning and still at it, and gives you the energy to fight the battles. And therefore I think there’s no question that we have given it all and, and I think that’s true for a lot of people, right? Most people, for instance, I’m sure each of you, when you look at your podcast shows friends, when I told you about the opportunity immediately said, Can you please connect me? So when you’re giving it everything, right? So all of us do. I’m not saying that everybody does, but a lot of us do. But a lot of us may not always necessarily find the success that we may want. And in my view, that’s okay. successes, again, in my view, like money is a byproduct. But I think more important is to really enjoy the journey, and do what you like. And that excitement really is, in my view, that’s really what differentiates working for a startup versus a very established company.
Siddhartha Ahluwalia 23:31
So I want to go back to 99. Right, what brought you back from Singapore to India?
VS Sudhakar 23:36
No, I didn’t go to Singapore. That’s why I said Singapore, there was an opportunity. I had to move if I didn’t. And that is when Planet Asia happened. And I realised that I didn’t have a clue about what that could turn out to be. And just the sheer excitement and that’s really where Hari came back. So if you asked a question earlier on whether we knew each other. So for instance, Hari Vipul and I worked together in TBS, electronics, then I went on to do other things. And Hari was working for Wipro at that point of time. So when planet issue started,
Siddhartha Ahluwalia 24:10
can you tell tell us more about Planet Asia is? Sure what it is.
VS Sudhakar 24:13
S o Planet Asia was started in 97. And basically, it was a company which was focused on building solutions, software solutions around the internet.
Siddhartha Ahluwalia 24:22
And who started it?
VS Sudhakar 24:24
It was Michael, and there is a Pradeep Kharr team and I was the first CEO of that company. And when we started, I needed somebody who was very strong from an execution perspective. So I called a Hari was in Bombay at that point of time, and in WIPRO and I said, you know, there’s this opportunity. Do you want to take a shot at it? Yeah, but highly risky, because I said, I’ve jumped in. So he, I think, took very little time to say boss done, I’m jumping in.
Siddhartha Ahluwalia 24:39
And he joined as a COO?
VS Sudhakar 24:39
COO, It didn’t matter. So for us, we’ve never really been too bothered. About right. So it was two of us were running it together. So both of us running, ran it together. And we didn’t really have too much of a division in terms of who does what. And to a great extent that’s continued even the bigbasket journey, but we, the five of us, we don’t really kind of have too much of a thinking, Oh, I can’t touch that, or you do this, or I do it. We really kind of mould well together.
Siddhartha Ahluwalia 24:39
So tell us more about that Journey.
VS Sudhakar 24:57
So therefore, there there we started this. And that’s really where the whole idea came in. In fact, it all started in, in, we built a payment gateway for Citybank.
Siddhartha Ahluwalia 25:25
VS Sudhakar 25:31
And so in one of those typical, you know, this classical way, we had gone to meet the City Bank, one of the senior people and just towards the end of the handover of the project. And so this gentleman turned to me and said, you know, what the payment gateway piece works for us. What we are also done was, we had built what was kind of a mall where they could bring their merchants to come and put up their products. That was that would have been the literally the first e commerce cruise in the true sense in an Indian context. So he said, the payment gateway business makes sense to us. But the small business doesn’t make sense to.
Siddhartha Ahluwalia 26:20
what is small Business?
Siddhartha Ahluwalia 26:21
Digital shopping experience!
VS Sudhakar 26:21
Small meaning see, what is the payment gateway payment gateways. Somebody makes a transaction today, for instance, when you make a transaction, what do you do with your fund finally come to the page where you make the payment, you click on something, then you’re taken to a payment gateway, where you give your credit card details, debit card details, details, and that section is called the payment gateway. So we had built that, so but to do to get to that point, somebody has to first buy something, right? So we built this the whole shopping.
VS Sudhakar 26:25
Exactly. Okay.But then somebody has to be there on the shop, right? And that we said would be the all day merchants out that’s where the Citibank local team had thought about it. So he said, this part I don’t want to do. Can you turn and ask us, we will continue to invest into the payment gateway, why don’t you guys do the mall? Perfect. Okay, so Hari. And I, this was the City Bank office in MG road. Okay, you will see those two black covers. So we just came out, there was a coffee day. So we sat down with her. And I said, this looks really interesting. So we came back and told Pradeep .
Siddhartha Ahluwalia 27:33
and you both were 40 then?
VS Sudhakar 27:34
We were 40, he was two years younger, so. So we came back and told Pradeep that this looks very interesting. Pradeep at that point of time said boss, I don’t think this fits in with what I have in mind for Planet Asia. Then we said, if that’s okay with you, then we would like to step out into a startup
Siddhartha Ahluwalia 27:58
startup for not cooler or at all? Not at all.
VS Sudhakar 28:00
No coolness was associated with it at all. But I think we, again, maybe it’s a bit of a timing. So that’s a time when the concept of a VC (Venture Capital) or an investments were just coming into play,
Siddhartha Ahluwalia 28:14
not in India,But globally.
VS Sudhakar 28:15
Even India, just about just thought started. This really we were in the literally the advance or the early stages of the.com. Boom, because the.com boom and bust happened in India very quickly. Yeah. In the US, it started around 95-96 and went on till 19.
VS Sudhakar 28:33
But it took a while before the.com Boom really started. So we came in in 97. And that is when it started in an Indian context. And the bus happened by 2000. Yeah, so it was a very quick..
Siddhartha Ahluwalia 28:33
When Amazon started in 94, and Jeff Bezos took it.
Siddhartha Ahluwalia 28:49
VS Sudhakar 28:49
boom to bust or bust to boom. So we came in, and that is a time when it was not yet cool. But we started realising that there is an ability to raise funding from outside.
Siddhartha Ahluwalia 29:04
and it was you Hari and Vipul?
VS Sudhakar 29:07
Me Hari Vipul there was Ramesh.
Siddhartha Ahluwalia 29:09
VS Sudhakar 29:09
right. Ramesh is my brother. He was in the Navy. He retired from the Navy after his 21 years of compulsory service and and he just come out so and we needed somebody who was very strong in logistics. So he done a lot of work in navy in logistics, so I requested whether he’s kind of keen to look at it, take a shot at it. He said he’s fine. And Vipul again was very interesting. So Vipul at that point of time was working for Wipro. So he came to Planet Asia to meet Hari and me and he said interestingly, he was looking at what internet solutions that Wipro should look at.
VS Sudhakar 29:48
Okay, so he came to Planet each year to see whether he could use planet Isha services. So we told him, we will create stuff, but unfortunately, you will have to talk to our successes. So he said we’re very you guys going. So we said we were doing this startup. He said, boss, I am on that. It was like that. It was like he literally said, boss I’m on. So, you know, I’m into it. And I take maybe two, three months to get out. But I’m definitely signing on for this. So he signed on Ramesh signed on, Sandeep who was with us in planet Asia he signed on. Okay, the sixth guy was Vythi, who was in Wipro was a very close colleague of Vipul and Hari. So they felt that for marketing Vythi could be a very good guy. Yeah. So therefore what we did, we spoke to Vythi, he took maybe a week to figure it out. And at the end of it he said he’s On. So, six of us came on board. This is really how the whole.
Siddhartha Ahluwalia 29:48
Siddhartha Ahluwalia 30:43
At that time the concept was not grocery, right? That that time.
VS Sudhakar 30:46
We wanted to do,In fact, it started with books, then went on to music, then went on to grocery then went on to jewellery, it went, we did everything. Okay, so literally what a Flipkart is today is what we did, but obviously on a dial up internet is obviously very different ballgame. But absolutely outstanding journey. Crazy technology challenges. The phenomenon from.
Siddhartha Ahluwalia 31:10
Then when did you pivot from an online to an offline.
VS Sudhakar 31:13
So, so when the when the bust happened, we realised we needed to do something different. So fortunately, what had happened was we had really started one physical store on a franchisee basis for big bazaar in the first big bazaar, which is in the which isn’t that Husur road the one next to forum. It’s not there now, I think. So we did a store in store for them for grocery, because they were on everything other than grocery. So we did the store in store. And we realised that maybe the way to pivot this should be to go towards that because internet had become a bad word. But ecommerce was obviously something nobody wanted that much.
Siddhartha Ahluwalia 31:56
But today, they are Berating startups and they have various bad apples, they are saying.
VS Sudhakar 32:02
100% I’ve seen this cyclical curve happen so many times that whenever they say, you know, now we are very sensible. So yeah, sure, sure. Another five years(Chuckles). So ,you’ve seen this now. So many times over the last 25 YEARS.
Siddhartha Ahluwalia 32:16
Various new bad apples that come after every 5 Years.
VS Sudhakar 32:19
100%, 100%. I mean, and people will suddenly throw in money after literally like, there’s no tomorrow. And then after five years, there’ll be one huge scarcity for money. Then again, there’ll be after three years, there’ll be again, one huge glut. Yeah. So I think it’s, it’s a matter of I think this is one thing which follows the sine curve, without doubt, right? So you can actually feel very comfortable, you can wait out for the next go. So it will come it has to come. So there’s no question about it. So therefore, the we, we kind of went on to doing the physical stores,
Siddhartha Ahluwalia 32:53
and you had raised some VC money back then?
VS Sudhakar 32:55
No, no, we raised I mean, you’re in a physical thing, we just did a kind of a bridge money and built it on a very interesting platform, we what we did was we use a technology we built for the online to primarily make sure the whole stock in movement management of was outstanding for a store. In fact, we did some very interesting thing in those days, which have become kind of quite standard. Now, you’re very new in those days. So we used to do a, what we call as a flow through where in the in the main warehouse, there would be no stocks, the stocks would come and move to the stores. So the entire stocks are sitting in the stores, which did two things for us. One, the overall inventory holding became low, because of which we were on a negative working capital. C working capital is a very critical piece in any retail business. So we were on a negative working capital, the early people to do that. Now, I think a lot of people do that. We do it in big baskets. So I think it’s become quite commonplace. Now, those days was very new. So we use that technology string to build out the thing but we did the stores on it franchisee basis. So we had franchisees who invested into the store and the and the store people and we said we’ll provide the technology and the stocks.
Siddhartha Ahluwalia 34:08
VS Sudhakar 34:09
And the whole cycle of figuring out what is selling what is not selling, buying more of that how much to stop all that we will do. So the franchising literally, we told them though, your role is to be the customer, person. So just focus on making sure that you have a personal relationship with the customers. That really worked brilliantly, in fact, because franchisees finally their money is made when they when the store does well. And when you take out all the things which you’re not good at, which is managing stocks, managing what to buy, how much to buy it all suddenly it just eases their time and energy to just focus on customers really made a big difference Fabmall really was a good good success story. It really did well. And then we merged with Trinetra and between Trinetra and Fabmall the whole thing got sold To the Birlas, which became More straw, that was in 2007. So that’s how that that innings ended.
Siddhartha Ahluwalia 35:06
And what did you What did you do for the next four years after that ended?
VS Sudhakar 35:10
So, VIipul and I used to invest. So, we were, I was very clear that it’s not going to a job and or even know startups also. So for me, I think the excitement was to see if I could now work with startups and really work in a way where the way we used to do this was brutal. And I used to commit half a day a week with each startup either about five.
Siddhartha Ahluwalia 35:33
Anyone any known names from.
VS Sudhakar 35:35
No infact, one of the No names is what has become Big Basket. So therefore, all of the things that we did was what we cannot I’ll come to that story a little later. So So really, we did that one was Edu-sports, which is doing well. I mean, they do sports for school. very very interesting from Saumil it was very good job. Yeah. So. So we did that. And the way we worked with it was we used to do half a day, a week with him. It was an amazing journey, because we used to spend two and a half days a week, right, actually going in meeting people working and gave us enough time to understand the business hands on. And therefore we could really in that, in that sense, to an extent value add to the those businesses. So that is what we did. And one of them was what started out as an online group. So it’s all in one of those, one of the people who used to co invest with us was the gentleman K Ganesh. you know?
Siddhartha Ahluwalia 36:35
Yes, K Ganesh and Meena.
VS Sudhakar 36:37
Ganesh and Meena. So Ganesh and Mina, we go back a long way. So we used to also do so in one of those meetings when we were discussing about some of the thing Ganesh told me boss we want to talk to you about something different.
VS Sudhakar 36:51
Is it okay, tell us what is it? So this is a boss, we should do something on? online grocery. This is 2011. July, I think So. That one over there. So is that we should do something in grocery, I think you guys have done online, you guys have done physical grocery. Now, the time is right. And just could be big. Isn’t it could be big. But unfortunately, we have already committed ourselves to this startup. So and we said both of us don’t have any interest in running the company so.
Siddhartha Ahluwalia 36:51
VS Sudhakar 38:01
Hari is willing to come on as a CEO?
Siddhartha Ahluwalia 38:03
You guys are then we are on? Okay. So he’s ready to take that full time plunge again, like, because I believe right. It was a 400. Crore exit. By more, right back at,
VS Sudhakar 38:14
That time, Yeah,
Siddhartha Ahluwalia 38:15
at that time, right 400 so all you guys where financially retired.
VS Sudhakar 38:19
Financially it was, which is why he said I was not at all keen on doing another startup of mine. So neither were others. So for us the point that, in fact, I still remember Hari said,was for this journey is not going to be about money at all and sake Leave alone. Anything else? Absolutely not. Not something that is going to be a consideration. We said it wasn’t much in that time. No, it’s going to be even even less. So what really happened was so hurry said. We said we told her if he comes on as a CEO, and if Abinay is willing to fold in we are fine. So when I spoke to Abinay, within the next two, three days, we spoke to Hari. And literally within a week, it was all sealed. So we said okay, we are back on the the saddle again. So this was July we I think it incorporated the company in August, and December, we had launched December 2011. And then it’s been one crazy jump,
Siddhartha Ahluwalia 39:21
Then I believe, you know, you guys had you will not do single thing till you secure an investor. And you were very fixed that it has to be a 10 million check. There’s nothing else than that (Chuckles).
VS Sudhakar 39:33
(Chuckles)Maybe that’s a bit of a stretch thing, but I’m saying yeah, we said let’s not jump in too early, but let’s make sure that we are funded well. And fit those days. It was one of the biggest checks for a startup because those are big early days, early days still for a business.
VS Sudhakar 39:49
It was like crazy in those days. So and it was fantastic journey. I mean it’s it’s really something which is just a Built on itself. I mean enough challenges enough ups and downs. So nothing, nothing comes free. Right?
Siddhartha Ahluwalia 39:49
10million or 40 million ,yeah.
Siddhartha Ahluwalia 40:08
So, did you expect that in this time at least there would be no zero to one challenges? Right, because the last time there were many zeros overnight, the market crashed when you started, you thought of doing online, you’re back to building brick and mortar.
VS Sudhakar 40:20
True. Oh, which is really I think, to a great extent, I would say, which is why, for instance, multiple challenges. The fact that there is a fundamental confidence about the fact that online and grocery are here to stay. Yeah, something we knew.
Siddhartha Ahluwalia 40:38
You knew in 2011.
VS Sudhakar 40:39
Not 11, I’m just saying as the journey progressed, we realised we seem to be in very good shape. I mean, the basics are all done in terms of the fact that is enough customer demand, there is enough traction happening. So therefore, it was more a question of making sure that the execution was outstanding. And that is really what needed to be done. Day in and day out.
Siddhartha Ahluwalia 41:03
So it was you it was Hari.
VS Sudhakar 41:07
Hari,Vipul,me,Abinay and Ramesh.
Siddhartha Ahluwalia 41:09
VS Sudhakar 41:10
Five of us five,so five, So four of us from the sixth. And Abinay as the
Siddhartha Ahluwalia 41:16
Abinay was the new guy.(Chuckles)
VS Sudhakar 41:16
(Chuckles) New guy,in a sense, but actually, as Abinay, keep saying that, when we were in 99, in pharma, he’d done a startup of his own, okay. It was called style country.com. So, at that time, he had met me a few times, so we knew each other. So that’s how when he started this new journey, because he went and did grocery for Infosys, in terms of Tesco and all that he did projects there from tech implementation perspective. So that’s really when he realised that maybe a Tesco kind of a model could work very well in Indian context. That’s when he came back and started and the moment he started, he approached us saying that it was something which you guys can definitely help me with.
Siddhartha Ahluwalia 42:02
And I think, K Ganesh and Meena Ganesh became the unknown co founders.
VS Sudhakar 42:08
(Chuckles)Yeah, we work very closely together right through. And because we knew each other since a long time, it just made it so much easier. And in a way, the way in fact, Ganesh pitched it was also very simple he said, you guys know, online, you guys know grocery. So you guys take care of the company building, I will take care of the funding, I will make sure that I bring the the investors into the into the game. So initially, he in fact, did a lot of pitches of his own. I think fortunately, since that thing came in very early, it really made our life journey that much easier. But nothing is easy. I can tell you that.
Siddhartha Ahluwalia 42:46
And how did you find a few roles played the roles among yourself?
VS Sudhakar 42:49
Yeah, like I said, this is really where we were very fungible, I mean, we didn’t really put some hard line saying this is you ,this is you, this is you. So it was always a very. So the way I look, Hari, obviously, as a CEO, to con the entire overall responsibility, including people and making sure that the fundamental pieces are in place. And Vipul, clearly took on the role of making sure the investor side and the finance was taken and marketing. So that was like a critical piece. Abinay, did a lot of things, including some of the new ventures we did in terms of b2b and all that and Ramesh took care of the entire logistics, okay. And I kind of really floated around trying to look at new areas, looking at troubleshooting, putting some amount of effort into tech, but primarily becoming more free, free floating source. I think it’s, it’s, I mean, assuming a company can afford it’s very useful, because, you know, like, I keep telling you guys also that the person with the least work in this company is me. And the person who has the most open calendar is me. You look at my calendar is always open. You want a meeting tomorrow morning, no problems.
Siddhartha Ahluwalia 44:06
2011, It was always open.
VS Sudhakar 44:08
mostly It has been like that. So mostly, my calendar will always be open because somebody wants to meet me, they can pretty much meet me the next two hours. I mean, so it’s it that way, what happens is, if it’s always very risky when, at a senior management level, people say their calendars are blocked for three weeks. I remember the early days when I was trying to meet gentlemen, and very senior person and he said, I think next month or on 25th We can meet. I said, my…( Inaudible), this gentleman’s calendar is fixed unless he was trying to pull me off in saying that, if I say so far, the guy won’t come. So but it wasn’t that because I knew he wanted to meet me but he’s, I realise his calendar was blocked. I said, How can you have your calendar blocked for 30 days plus, I mean, doesn’t make any sense to me if, which means your mind is blocked for that long So I think it’s very important, especially for senior management to really have open slots. Once from the perspective that people can approach you if they have an issue or the it. More importantly, if they have an idea, you have the time to think if your calendar is blocked, you don’t have time to think that that’s one thing, which is always a big worry that if people are just going from meeting to meeting to meeting, and just only listening or maybe sometimes contributing, are you getting the best out of those people? So I am very important for people to have that, in essence, what now I think every popularly called me downgrade. So whether you call it me time, which is me personal or me official, it doesn’t matter. So I think me official time is also very important.
Siddhartha Ahluwalia 45:46
lock your calendar for yourself.
VS Sudhakar 45:47
Exactly. So that, you know, you have time to think sometimes, otherwise, you’re just wrong. You could be just running the race, just very hard without really knowing for sure whether you’re running the right direction, or not good to sometimes stop figured out. And it’s it’s nice, I mean, and more importantly gets you in fresh every morning. If you’re if you’ve kind of back to back all the way, an extra morning, again, you’re studying back to back, I’m embarrassed to lose..
Siddhartha Ahluwalia 45:49
You, lose the joy of doing it.
VS Sudhakar 45:48
Exactly,how you need to feel the pulse of, you know, you need to feel alive, whether it’s in your personal life or in the professional. I mean, when you walk into the office, you should feel energy. Yeah. And I remember in our old office, we used to for a long time, our corporate office was one on Domlur, which is one floor of 2000 square feet, okay, till about what 2017 and by which time we had become reasonably big. So people say, Oh, this your corporate of this corporate. yea, we, this is our corporate office . this is where we sit. So in fact, Vipul was very keen not to move from there. But finally, I think he realised it was becoming too complex to have three, four offices, people distributed. So then we moved to this new office. So in that office, it was a small office, but a lot of people used to tell me when they will come in, they would say, first, we can feel the energy in this office. So I think that’s very important. When you walk into the office, do you feel energy? Or do you feel a very kind of uhh.
VS Sudhakar 46:19
when you walk into the neon zone here? What kind of energy
VS Sudhakar 47:01
Nice, I found I mean, I found that, you know, all the people see, frankly, this a smile. Yeah. Right. That’s the first and most important thing, and you’re gonna have a smile, you’re gonna be half dead anyway, right? So you have a smile, you have energy, you have that P. And that’s when you get the sense that you’re enjoying what you’re doing. So you’re not doing it because Okay,we have to do podcast today,lets do it(Speaking in Hindi)is all of this is kind of energised, that makes a difference.
Siddhartha Ahluwalia 47:58
So I want to ask right now reflecting back on 40 years of work almost right, which has been your best decade personally and professionally. But of course, it will take time.
VS Sudhakar 48:11
Yeah, no, I mean, I don’t normally kind of try to box it like that. But I will tell you, one of the things that I’ve enjoyed the most surprisingly, is my stint in, in Microline, Delhi. In fact, I used to have a small office, some 25-30 people, but selling and servicing in those days very good networking equipment, which we used to say.
Siddhartha Ahluwalia 48:36
This is which Decade to which Decade?
VS Sudhakar 48:37
This is 93 to 95. So it’s..
Siddhartha Ahluwalia 48:39
I still to here, I want answer in decade.
VS Sudhakar 48:42
The whole decade you want? Oh, I mean, I think decade wise, I wouldn’t really differentiate all Decades’ve been brilliant. I mean, Touchwood, brilliant, meaning not messily in terms of success. Don’t take it to the wrong way. I’ve been brilliant, because I’ve enjoyed it. Others may not have but I’ve enjoyed. So.
Siddhartha Ahluwalia 48:58
Those two years you recall specifically.
VS Sudhakar 49:00
specifically because somewhere, I think it was it really set the tone for what I did for the rest of my milestone, I think it really was a very good experience I had. And one thing which makes me really happy is the people who join me in those ways. Many of them joined from as engineers from coming from a third level engineering college and all. Many of them are done brilliantly well, they many of them start companies, they’ve done extremely well. So it gives me a lot of joy. For instance, out of the blue after around 2007 or 2008 one of these gentlemen who was working in Singapore called me saying, boss, you know, I want to tell you today I did something which you told us long back, and I remembered you because, you know, I didn’t work for me. So I said, you know, you can get more joy than that. So a lot of that happened during that time. But I think all I would say across the board. Most of the journey has been very, very enjoyable.
Siddhartha Ahluwalia 50:00
which was more challenging Big basket or Fabmart?
VS Sudhakar 50:02
Fabmart was a much shorter run, Big basket has been a much longer. So in phases, I think both have been challenging in phases, both have been amazing. So I wouldn’t really say this has been more or less. It’s where it’s just that that didn’t take to the scale that this has gone to.But I would say challenges change. That’s all as you scale, the kinds of challenges you get are very different.
So the kinds of challenges changes, but challenges are always there. Otherwise, it gets boring also. So in fact, it’s like driving in India versus driving in Australia, right? So when I drove in Australia, we’ve pretty much the problem, the biggest problem was you falling asleep is nothing happening. And New zealand, especially if you’re driving New Zealand, you don’t see anybody, many times you don’t see anything else, you just drive in, but absolutely, amazingly beautiful. But nothing happening on the road. So you can potentially get fall asleep in India you every 10 feet on an expressway. So if you’re, you’re on your it’s like running a startup driving on Indian roads is like running a startup. So you need to be on your toes.
Siddhartha Ahluwalia 51:23
India is the third startup nation in the world right after,
VS Sudhakar 51:28
because we are also trained for it.
Siddhartha Ahluwalia 51:30
And you heard ofthe teamside of 15,000. Right big basket,
VS Sudhakar 51:35
more now. Now it’s about 30 -35 thousand. So it’s pretty large, which is obviously nets, that brings a different set of issues. scale has its own problems, but it also has its benefits, because just the fact that for instance, when the early days, you know, like I keep saying, like if you look at the top FMCG companies, you would go there, right? When you become reasonable size Summit, you’ll meet in between, once you very large, they come to you. So that’s really what scaled does to you. So scale gives you the benefit. But I think one thing, we keep driving very hard. And there’s one other thing where I think we are not very good at as Indians. That is we don’t, the moment you are in a position of strength, you bring in a lot of arrogance into it, right? So for instance, the way we treat our people who sell to us, right, we always feel that I’m doing your favour by buying from you, you’re not right, actually, that humility needs to be there. And that humility needs to be there in your finance department. So one of the things we did when we did our direct buying from farmers, one of the big worries we had was this a collection centre in the middle of nowhere, right, where the farmers are coming in delivering and ideally, in a typical cash payments scenario, that’s the guy would have paid the cash also. And the moment you do that, he becomes a powerful guy. So he can use that power against the farmer, he can leverage his leverage. So we said we need to change that. And thankfully, one of the one of the things which happened beautifully at that point of time was this whole government scheme of
Siddhartha Ahluwalia 53:18
Offering new bank accounts.
VS Sudhakar 53:19
New banks, new bank accounts, right. So we told all the farmers if your work because you’re to have a bank account,
Siddhartha Ahluwalia 53:24
This is which year?
VS Sudhakar 53:25
It is 2015-16. That’s when the Jhan-Dhan just started. So that is really why make it, made it very easy for us. It was a real boom for us, because we told people that you can’t tell us that it’s difficult because now with Jhan-Dhan, you can’t see now you can open an account. So we said it’s mandatory, and we will only pay into your account. And the big plus for you is, You don’t need to follow up with anybody.
Siddhartha Ahluwalia 53:47
You don’t need to fill papers or anything.
VS Sudhakar 53:49
Nothing. No, and you don’t need to talk to anybody, you don’t need to ask anybody, the money will get into your bank account this much before the UPI days. Okay, so we in fact, work with the banks to do so the way it caught was the person would come and deliver in the system it gets entered, it automatically creates the because they don’t have a bill and all that right. So it just creates equal end of a bill, creates a payment voucher, and the payment also go to the bank and the bank would then create the farmer account. Typically we said next day, next working day, when sometimes with a second working,.
Siddhartha Ahluwalia 54:25
But the farmers only responsibility became to deliver the goods to your warehouse. That’s it. That’s it, he didn’t have to go to the bank.
VS Sudhakar 54:32
Siddhartha Ahluwalia 54:32
VS Sudhakar 54:33
Nothing. And that continues till today. Now, of course with UPI, it’s become a lot simpler. But we did this before UPI because UPI came in a little later. So and but the big enabler there was agenda. That was an amazing scheme. They really made sure that even the poorest of poor could open a bank account and that made it easier for people to deal with them. So the the reason why I’m saying that is A potential place of power for a person over that farmer, we removed it. And we have to think like that we have to say, how do I make that farmer’s life better? How do I, you know, be as the stronger person, it’s your responsibility to take care of the weaker person, right? Normally what happens is as a stronger person, you exploit the weaker.
Siddhartha Ahluwalia 55:24
You exploit the weaker!
VS Sudhakar 55:25
So that’s exactly the point you made it perfect. We put it perfectly. And how many farmers work with today, today we about I think 15-20,000 farmers in..
Siddhartha Ahluwalia 55:34
South India or North India ?
VS Sudhakar 55:35
Across India, across India. So we have about we have what we call us this collection centres. These collection centres are typically about a 3000,4000 square feet place, where we have agronomists who are trained agronomist, people who are from agriculture, BSC agriculture background, one of them will be there and there’ll be the buyers, very small team. And the job of the agronomist is to work with the farmers in that area to help them with some tips on cultivation. Basics, bring some signs into the whole thing, and be of assistance to farmers as required, don’t go and push them, but be of assistance to it. So they come and deliver it there. And the moment they deliver it, it gets weighed. And the and the receipt is given to the farmer and the money reaches his bank. So it really, it’s been a very, very important fact, one of our investors in CDC, which is of course called a different name, now, of UK, they also have a social responsibility aspect. So they have a team which comes in checks from a social responsibilities. And so they wanted to go and talk to a lot of farmers. And they did that. And one, they were very happy at the end of it. Because one of the things the farmer said, in fact, this two things, one, we get almost six to 7%, more than what we would have got otherwise. And we get our money in two days. And without follow. We said exactly what we wanted to change.
Siddhartha Ahluwalia 55:58
That to the distributor would have been the same, they would have followed for 30 to 90 days.
VS Sudhakar 57:15
Maybe. So the point really is, more importantly, the pain of following the keys, which is really sometimes you know, as you get as you scale, the bigger worry for all for us always is there are many touch points, right? Because it’s not that we can control every touch point. How do we make sure that so one of the things, which is always a point of worry for us, and we try our best to communicate everybody that if at all, somebody asked for something different? To supply to big basket or to work with big basket, these escalate to us? Because I mean, one thing we are absolutely ruthless about is integrity, because we feel that if somebody is, you know, in any way. So two things we are absolutely ruthless about is that and you know, the whole thing about, you know, sexual harassment and all that we are fantastic, in fact, very strong women’s team heading HR. So they make sure.
Siddhartha Ahluwalia 58:13
That I remember teen Hari setting it up very well.
VS Sudhakar 58:15
Yes. Phenomenal setup, in fact, very, very, because it it, we always tell people that it should hurt us inside, right? When something like this happens. And because if you say that it’s okay. I mean, it’s from large organism, you can’t afford to do that.
VS Sudhakar 58:34
And these 30,000 people, or they’re all full time employees of bigbasket.
VS Sudhakar 58:38
No, I mean, I would say half of them are half of them are the what we call us now, the gig workers, as the terminology has been given very. But for instance, we do a few things which we really feel are important. Like, we have a trust, we’ve created a trust that what we do in the trust is we offer educational grants to these delivery people, including people who are gig workers, and our pickers and the lowest level in that sense in terms of the salary scale for their own selves, because many of these guys are people who are 21-22, who dropped out of school because they didn’t have the money, but want to do it. Yeah. So we help them with grants to go back to school. And sometimes they want to do it for their brothers. They may not want to do it, but they want their brothers or sisters or their children in fact law. That’s what we sometimes we are amazed some of these grants are coming for. I mean, in the name at least International School. Okay. What I mean may not be the true international school, but English medium schools so they want to educate their kids because the good thing is there is that upward movement in terms of what they want their children
Siddhartha Ahluwalia 59:53
That their only short reset to go from a family which was 15 to 30,000 rupees a month. to aspire for lets say a lakh to be the month.
VS Sudhakar 59:54
Exactly. And it’s, and I think as organisations, we have the capability and the wherewithal to do it, just do the best we can. So we we set up this trust. And that’s one amazing team, we wrote a fantastic board right through all along. So the board didn’t want kind of, we just told them that this is our plan, this is what we want to fund the trust, it was approved within some
Siddhartha Ahluwalia 1:00:28
at Noon, we tried to do it in a very, very, very small way, right, or management fees is very small, because the fund itself, we are now raising 25 mil for the earlier when was 10 mil out of Asia, we have invested right now 40, SAS companies.
VS Sudhakar 1:00:41
Siddhartha Ahluwalia 1:00:42
Of two to three years. So a part of the management fees is carved out for the kids of help, right?
VS Sudhakar 1:00:49
Siddhartha Ahluwalia 1:00:50
Where it can be our help, or it can be any
Siddhartha Ahluwalia 1:00:52
Any help that are each fund, the goal is to support three children with their entire education. right?
VS Sudhakar 1:00:52
VS Sudhakar 1:01:00
So wonderful. I’m just saying this is fantastic. What I’m saying is, don’t worry about the size of what you do. Start doing it, because the more people who do it, and more Importantly, I’m happy that you’re talking about it just I think let’s spread this word around that all of us can do whatever we can in our own small way. And that’s gonna help. In the end, I think the good news is people are looking at the fact that education is the only thing that’s going to get them out of the Hole.
Siddhartha Ahluwalia 1:01:27
India is the only thing that changes the orbits of a family.
VS Sudhakar 1:01:31
Exactly. And that’s what is going to change the orbit of India.
Siddhartha Ahluwalia 1:01:33
It’s the GDP of India that we often talk about It’s so low ,so low?What can change, GDP of India.
VS Sudhakar 1:01:38
It’s already changed quite a bit in the last 25 years. Right. 25 years do you come? I mean, I would say 91 onwards, since then..
Siddhartha Ahluwalia 1:01:46
You come from an educated family. Right. Your father was in railways, right? Your father could support your higher education dreams you went to IIM Ahemadabad about right. But have you seen in the these last 25 years, people from lower strata than you? Because you have such a rich experience? Jumping into higher orbits just by means of education?
Siddhartha Ahluwalia 1:02:08
I would say at least in bigbasket, we
Siddhartha Ahluwalia 1:02:12
Bigbasket before BigBasket ?
Siddhartha Ahluwalia 1:02:13
But can you have people in Product Manager who are 12th Pass.
VS Sudhakar 1:02:13
No, I’m saying our belief. That’s true even earlier, is that more than, you know, education as a barrier. We see education as an enabler. So it is not required, for instance, for us to say that, Oh, this guy is not an MBA, then he can’t be this. For instance, we have had people in product management, who are not MBAs.
VS Sudhakar 1:02:39
I don’t know if this is a 12th plus, I can check and tell you. I can tell you one thing for us in our previous three, I mean, around Fab mart days, the gentleman who headed merchandising at a pretty senior level was somebody who was some 10th Pass or 9th pass or something. It didn’t matter. Because once you see the capability in what you did in school or college is irrelevant. So one of the things we are very clear about is people are not going to be judged based on their educational qualification, right. Education qualifications, good to have not mandatory. So we’re very, very clear about it that nobody is going to go up because they have an IIM degree right. Or
Siddhartha Ahluwalia 1:03:26
you’re trying to build a IIM a Nexus?
VS Sudhakar 1:03:28
Not at all. So leave alone. I mean, there’s no bits. There’s no IIM Bangalore mixes nothing. Yeah. Right. Because I think some of our best guys are not necessarily from him, not from MBA schools. I think we have some amazing guys like that, in bigbasket, Today.
VS Sudhakar 1:03:49
And even in Leadership?
VS Sudhakar 1:03:50
leadership 100%, haven’t we, for us, that’s definitely not the most critical piece. But if at the same time, I don’t want to tell a guy that Oh, you’re from IIM I don’t want you. That’s being foolish. So you would say people have to earn their fact. That’s one thing, which I always tell our guys also. And that’s something which, if you look at startups, it’s very important that people don’t get respect because of their past achievements, or, more importantly, past qualifications. It should be based on what they do. Yeah. And and I think one of the things that is very critical is people are made to earn the respect from the team below. Not necessarily because of the fact that I’ve given you a title of Vice President, therefore, you have to be given the respect you won’t be in bigbasket You won’t be just because you got a title doesn’t mean anything. Finally, you earn that respect. And you earn the respect by value adding your team, right once you set that as a culture becomes a lot easier. I’m not saying it’s easy, not at all easy. But you should be ruthless about it should be very focused on it.
Siddhartha Ahluwalia 1:05:04
The other thing that I want to talk about is right, obviously the exit by Tata and the operational focus on profitability, right? That Tata is now trying to focus each of his companies that they acquired towards that you guys need to be independent and you guys need to do an IPO.
VS Sudhakar 1:05:24
Siddhartha Ahluwalia 1:05:26
Right. How did Tata happen and how this focus came in?
VS Sudhakar 1:05:28
I mean, see the Tata deal happen when, interestingly, they approached through a known person at a very senior level.
Siddhartha Ahluwalia 1:05:40
It wasn’t through a banker or something No,
VS Sudhakar 1:05:42
No, not through not the first. First thing, bankers came later. But the first connect happened with Harry directly with a very, very, very senior person who also happened to be a very, very big customer of bigbasket as a individual customer. So this person was a very, very loyal customer. And the person had told the data, very, very high level leadership team that, and that’s really where they did some homework. And they came back and said, from a business perspective from where they wanted to go, and more importantly, I think that’s one thing which came again, and again, even after we did the deal, a lot of people felt that the good thing is, in terms of values, there seems to be a lot of shared values, everybody felt that bigbasket, as a company is more aligned with a data way of thinking rather than anything else. So in a sense, it kind of that’s the feedback they kept getting. So they said, Okay, this is a company that I think we can work with, because this seems to be a company that keeps what we think are important as their key. You know, you’re
Siddhartha Ahluwalia 1:06:54
buying valuation, terms of another metric, you’re already a unicorn or $1 billion company by much.
VS Sudhakar 1:07:00
Yea, yea. So that, I mean, obviously, the valuation was obviously an initially a pretty tough thing to get over. And the crazy thing is, this is such a complex and a very large deal. And all of it happened without one meeting, because this is the time when COVID was just right. Outstanding, how a deal of this size we could do without actually meeting.
Siddhartha Ahluwalia 1:07:26
It was it was a real pressure for you, right? Because to follow this.
VS Sudhakar 1:07:30
This Just after the first .Any meetings mean,
VS Sudhakar 1:07:59
Everything on Zoom. Today, if you really think back, you really wonder, would it be feasible to do it again? I mean, sometimes some of us I think I’ve already forgotten the learnings. In fact, I still recollect from my house from my balcony. You know, the interesting thing is, during COVID, suddenly, my neighbour who was a balcony also facing the same direction, he told me, you know, what I saw Nandi Hills is like, what, some 60 kilometres away? I said, Is that feasible? I mean, I thought it’s too far off. And I realised we could and throw COVID After that, we could see Nandhi Hills. Right. So we could see the K.R. PURAM bridge, and then the Nandhi Hills after that, and since then, you know, it’s so we’ve forgotten all the good things we learned. I think we learned a lot of good things in COVID. And somewhere, I think we’ve all gone back to living the same way
Siddhartha Ahluwalia 1:07:59
Everything on Zoom?
Siddhartha Ahluwalia 1:08:54
VS Sudhakar 1:08:55
Somewhere. It’s sometimes makes me feel sad. I mean, we learned so much, we could have at least kept 50% of it with us, we’ve gone back to doing exactly, so back to No Nandhi hills. So before coming back, I don’t think we can do a deal of that size and structure and complexity,without meeting.
Siddhartha Ahluwalia 1:09:16
That how much time it took from the first meet introduction
VS Sudhakar 1:09:19
2 to 5 months, which is not bad at all.
Siddhartha Ahluwalia 1:09:21
Which got concluded.
VS Sudhakar 1:09:22
Amazing, actually, it was something which went very, very well, because I think there was a it was a synergy. And there was a commonality of purpose. And there was a commonality of values.
Siddhartha Ahluwalia 1:09:36
And I think the way the Tata structure, I think every deal is the founders are allowed not to sell any of their shares, right. I think bigbasket You guys never sold any of your shares, right?
VS Sudhakar 1:09:47
No, no, which is why we are people feel it’s 100 person. Deal. It’s not right. They have a.
Siddhartha Ahluwalia 1:09:54
50-40 to 70 for it template for it.
VS Sudhakar 1:09:57
They were controlling stake, but I think the amazing thing is because of the commonality of values, more than anything else, it just made it easier, because we could trust them, they could potentially trust us. They knew that when I when we say something we most likely mean it. And that’s something that we’ve always maintained that the board also there is bad news, which is, it’s always very tricky. That’s one other suggestion since, you know, we also talked about the fact that this could be useful for startups, one thing I always recommend very strongly is have a very transparent communication with investors, right? Just make sure that, in fact, we used to meet the investors the board every month, for the first almost five years, every month, we used to meat. And every month, we used to present the data and we used to present it without any colouring. So, I mean, you would get hammered. There’s no question about it, when things are not going good, you’re gonna get hammered. But it’s better to get hammered than try to hide it. In the back end, you only make it worse later on. So it’s better to be upfront, some people may get away with it. Some people may get away with it forever. But that’s okay. It’s their luck. But I think it’s very important to so one of the one of the things that we’ve always done even since the year also is try and be upfront and saying, yeah, something bad happened, what happened, what to do, like just like that. I mean, we’ll try our best to avoid it, we’ll try our best to ensure it doesn’t happen again. No point running away from a problem. And no point hiding it more than anything else. Don’t hide anything better to be absolutely honest and upfront with the board.
Siddhartha Ahluwalia 1:11:43
Thing, The other thing I appreciate about even after, you know, the merger happens, they mark, they devalue the company fairly, for example, with big basket, right? They bought 60% Plus take for 1 billion plus. And now they valued the company, again, in a refinancing at 3 billion.
VS Sudhakar 1:11:58
Exactly. Absolutely. No, no, I think that’s good. So far, it’s been a fantastic journey, and continues. And they’ve empowered us. They come in at a board level. They give us good directions, they’ve given us phenomenal amount of support with other group companies where we have some businesses, right? So it’s, for instance, we sell to all the Tata hotels, right, the Taj hotels. So it’s a very, very,
Siddhartha Ahluwalia 1:12:30
what about profitability? Do you have any benchmarks on it? as Tata.
VS Sudhakar 1:12:33
Not as much Tata as much as
VS Sudhakar 1:12:36
It’s something I ourown. And Tata’s as a group, as you rightly said, very clearly, they’re saying, boss, we’re not here to do charity, if it’s a charity, it’s a separate feed, as a charitable organisation,(Chuckles) in a charitable organisation will do charity. But in a for profit company, we are make profit. Yeah, right. Absolutely fair. Absolutely fair, absolutely. The right way to look at things, right. So we also tell people that, I mean, I don’t know whether a customer needs charity from you. Right? If you can’t make the customer pay for what they have to pay, that means you’re not doing your job well enough. That’s only thing. So if you do your job well enough, a customer is not asking for charity. When I’m buying from big basket or from Flipkart, or from this Amazon, I’m not asking for charity, right, you don’t need to do. I mean, I’m not in need for charity of charity. So therefore, the point is, finally the customer has to value that service has to value and therefore pay for it, which is really the journey that we need in but I think the one thing which has worked very well for us is the fact that it’s not just Tata’s right? It’s the global economy is pushing everybody across the world, not in India moreso elsewhere, where you don’t make money, you’re out
Siddhartha Ahluwalia 1:12:36
Siddhartha Ahluwalia 1:13:48
From valuing a company based on the book value now they’re everything cashflow positive,
VS Sudhakar 1:13:54
Absolutely. So I think, fortunately, everybody is back to fundamentals, which is great. We’re extremely happy about this movement, because fortunately, for us, that is our native way of approaching things. So therefore, in a way it suits us very well, when you have to compete in a market where there are three guys who are behaving in a insane way, there’s no opportunity for you to say no, no, I’m going to be the same guy, you will get killed. So you have to also become partially insane. Everybody has become say no. So we’re back to what you said. So we partially moved towards insulin, we’re back to sane again.
Siddhartha Ahluwalia 1:14:30
So when do you expect to hit like at least some profitable?
VS Sudhakar 1:14:33
Oh, no. See, the good thing is all businesses, especially the older businesses, make money on a per order take that business no per order or and it makes money at uh, other than corporate costs, right? Everybody makes money, all the older businesses. So that’s something that we’re very clear about and makes decent money. The only thing is we have to cover everything and start making the corporate rich, corporate marketing, motivating As marketing is also pretty large. So all that put together we do. That’s really where I think we are on a, I would say very good journey towards a very good journey. And I think, in my view, very, very healthy journey,
Siddhartha Ahluwalia 1:15:13
But you never face the challenge of 10 minute delivery. Like, because the that has changed the behaviour. Right?
VS Sudhakar 1:15:19
It has, it has it is a challenge, which is one of the big challenges we face. And I think our first reaction to this when this started in the global economy, right, it’s not something which started in India, started in Europe, surprisingly. And, in fact, a lot of our board members told us, it was just this one new interesting thing, which seems to be scaling pretty well in Europe and all that. We told them, see, it’s not going to be very easy to make money there. And we really don’t know whether somebody needs grocery in 10 minutes. Right? So we said, pocket, I don’t want to touch it right now. Because it’s going to be very difficult to make money on it. Therefore, let’s not go into something when it’s not going to be easy to make money. So we said, unfortunately, as as it turned out, when customers were told that I will not charge you more, I will not charge you delivery fee, I will not charge you anything. And I’m going to give it to you in (Inaudible), customers are great. They’re fantastic. Give it to me. So everybody said give it, so we realise it’s scaled much faster than what we thought it was. So we had no choice but to scramble and quickly build the solution. Thankfully, we really turned it around very fast. And BB now has been, has been doing very well. The key focus area, now we’ve figured out what we need to do to make BB now also make money, because we can’t afford a service, which is going to drag you down. So very clearly, there are a lot of good stuff, both from technology and from process. If you’re putting into place which should kind of make sure that even a BB now service is not going to be a drag on profitability
Siddhartha Ahluwalia 1:17:07
for this podcast while preparing for it right? Internally, they call you god of small things. Like very detail oriented.
VS Sudhakar 1:17:15
Yeah. I didn’t know this. But I think don’t get too much carried away by all this. Yeah, God, I
Siddhartha Ahluwalia 1:17:23
don’t want you to take yourself seriously, you have never taken.
VS Sudhakar 1:17:25
I’m a little detail oriented. Yeah, that is true. In fact, one of the things which people always tell me boss your meetings, we’re always..
Siddhartha Ahluwalia 1:17:36
VS Sudhakar 1:17:36
Really, scared to come in because we don’t know what question you’re going to ask, which I haven’t thought through. I always tell them, Don’t worry about it. But I mean, the point really, is to be very detail oriented, which is why it’s all it’s all together, right? Being detail oriented, being process oriented. You know, when you think through something, think, go down to the last level of detail as much as you can,
Siddhartha Ahluwalia 1:18:01
Does it come to your personal life as well like to have tea at 8am sharp, and you have to finish it in five minutes.
VS Sudhakar 1:18:07
And like, you know, it’s not as bad as that, but my wife sometimes tells me you’re gonna give me real problems when you’re getting to 75 You’re gonna kill me if you’re going to contribute like this. Yeah, I mean, I’m not as worried about the time but for instance, you know, I seem to think like for instance, even if it if it comes to grocery, which is why we always used to wonder, why do people need BB now equal in service because if you plan, you should never run out of anything. But we have we have for instance, a small pantry, that I have a simple thing that when you move it from the pantry to your active use space, I ordered it. So for me the important thing is in pantry is that one stock available of every item or all the key items, the moment you look at that you’ll never have an emergency once in a while, you may still miss after all this, but that’s more more be more coordinate case. So in that sense, I’m very detail oriented even at home and give, you know a lot of grief to a lot of people.
Siddhartha Ahluwalia 1:19:13
Thank you so much. It’s been a pleasure, hosting you.
VS Sudhakar 1:19:16
Thank you very much.
Siddhartha Ahluwalia 1:19:17
I learned a lot and enjoyed a lot.
VS Sudhakar 1:19:19
There’s been I mean it was wonderful. I love talking to you guys.
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