In this episode, we chat with Nishith Rastogi, Founder of Locus.sh; a startup that uses technology and proprietary algorithms to provide smart logistics solutions to businesses such as route optimisation, real-time tracking, insights, and analytics, vehicle allocation, and utilisation.

In 2015, Nishith along with his former AWS-colleague Geet Garg, built RideSafe, a real-time route deviation detection, for passenger safety in cabs. However, they eventually realised the potential of this concept in logistics & supply chain, which led to pivoting to Locus.

Apart from India, Locus.sh is present in Jakarta, Ho Chi Minh, San Francisco, and the East Coast.

For anyone looking to explore horizontal pivot or growth strategy, this conversation can add great value. From identifying the problem statement to creating customer-focused solutions, by leveraging a committed team & inward focus for efficiency, this podcast will guide you through it all.

Notes –

01:55 – Graduating from BITS Pilani, joining Amazon

03:11 – Creating RideSafe, a geo-tracking app for women’s safety

04:26 – Identifying the problem statement in supply chain & logistics

05:53 – Early adopters of Locus.sh

09:30 – Having more PhD’s in the team than engineers early-on

11:58 – Onboarding experience with Unilever; as first enterprise customer

17:56 – Scale up journey from India to 20+ countries

22:15 – Clarity of purpose both as a startup & founder

30:40 – Inward focus on efficiency in terms of capital

31:20 – Cultural shift with the growth of Locus.sh

31:35 – Focus while hiring: Ambition, Commitment & Integrity

36:48 – Concept of “Yes process, but no policy”.

39:21 – Implementation & Ideation OKRs

42:01 – Helpful books & resources

Read the full transcript here:

Siddhartha 0:00

Hi, This is Siddhartha Ahluwalia, Welcome to the 100x Entrepreneur podcast. Today I have with me Nishith Rastogi, founder of Locus, Welcome Nishith to the podcast.

 

Nishith 0:11

Hey Siddhartha, Glad to be here.

 

Siddhartha 0:13

So just to introduce Nishith, He is the co-founder of Locus, a platform that provides proprietary routing, packing, scheduling and gardens to provide optimized and smart logistical support for e-commerce and delivery companies. And the aim of the service is to reduce logistics cost, the ship deliver platform after he realized that RideSafe and application that uses real time route deviation detection engine that he created to provide a safe commenting experience on have commercial and business application in other contexts. Tell us your journey from BITS Pilani to Locus, Nishith.

 

Nishith 0:54

It’s been a very interesting journey, very fast paced journey. Sometimes when I think of it, I feel both that BITS was just yesterday, and yet so far back, graduating from BITS Pilani, I joined Amazon, where I got a chance to work on the Amazon Web Services platform, very specifically the AWS machine learning platform. Interestingly, this is where I also met my co-founder Geet. So both of us come from different school, I graduated from BITS Pilani, Geet graduated from IIT Kharagpur. And both of us met at Amazon, we worked together there for a couple of years. And as we were building out the AWS platform, we quit our day job to start building, right safe, which was a women’s safety app. Both of us had no background and logistics, right? We were We were just hardcore engineers, both by education, by profession, as well as I would say, by hobby we really, really liked and enjoyed our engineering. And during that time, there was a pretty infamous incident that had happened, which was where Uber, there was a Uber passenger, her safety was compromised by the driver. And most of these incidents happen when the driver takes you somewhere else instead of your destination. So to combat that, Geet, and I built out an app called Ride Safe. It had a route deviation engine, which we used to call R2D2, real time route deviation detection. The special thing about this engine was that it did not need a route to detect a route deviation. Much like a rational human, if you tell the engine that hey, from the airport, I’m going my home. The algorithm will automatically detect all the potential variations in route and if the driver is taking you somewhere else and safe. Now, interestingly, what happened? Like we launched this, we got a great response. This was around the march of 2015, we got a very good adoption among the consumer base, a lot of people started using it. But interestingly, what happened was that that was also the time a lot of these new age hyperlocal companies were coming up. And a couple of them started using the ride safe app to manage their delivery boys. And that was a little surprising for us, because you know, we had made it as a B2C application. And here we were seeing startups using it in a B2B use case. So when we dive deep there that, hey, why are you doing that? Right? Like, why? What is the reason that the current tools are not working for you that you need to hack together a solution like this? And that’s when we realized that in supply chain over the last 10 years, there has been a lot of progress on solving for visibility. Right. So the startups were not using our app to figure out where their delivery boys were. But what they were wanted to do was that, what’s the point of knowing where they are? Can we just get an alert, if they are at a place, they should not be? Right? If they’re deviating from going to the kitchen and coming back and we get an alert? And that was a very material insight that while there has been a lot of solution towards visibility in supply chain, there has been very few or very little effort around the decision making in supply chain. And that’s what Locus does. Locus is a technology platform, which brings end to end real world decision making, that there is no reason for so much amount of manual intervention to happen for taking a package from point A to point B. Can we come augment all the human decisions and really solve it in a way that’s real? That’s actually executable on ground?

 

Siddhartha 4:49

Fantastic, and who are those early e-commerce adopters? And how did you, you know, then choose to pivot the solution?

 

Nishith 4:58

So most of these were hyperlocal companies or e-commerce companies that were starting up, you know, often introduced to us by our mutual co-investors, right? The interesting thing was that, so for example, one of the big decisions we solve for companies is that if today I have 100 packages, what is the best way to dispatch them? We thought the problem is as simple as you know, you have 100 packages, say 10 vehicles, let’s match them and figure out the best way to dispatch it. But that is not what the real life problem is real life problem is more likely that I’ve 100 packages, I don’t know the number of trucks to use, and what should be the size of the trucks and three trucks I already have with me the rest I need to get from the market. For that I have four different contracts with service providers, these are the rates, Now tell me how many trucks should I use? Of what size from what all service providers today? But while doing that, I also need to factor where does Siddhartha live? Not only the traffic and weather, how wide the road is over there? Whether there is a security in your apartment, which will add time to the next delivery? Is there a probability of rain today in your city? And what is the number of dispatch trucks that will go on from my dispatch center? Because every dispatch trucks take time to load. Right. So now, over the last five to 10 years in supply chain, you and I have entered it. Previously, we used to go to a retail store and pull from that supply chain. Right. Today, most of our packages are pushed to us like an app notification. So the underlying supply chain, and it has become really, really complex. At the same time, the time to solve it has dramatically reduced. 10 years back, you will take the entire winters decide the best route for summers for Coca Cola for that demand and deliver it right. But today, your demand changes every few hours, every few minutes. And as we just discussed the the complexity of delivering to an end customer at their home in a one hour slot is 10 times more than delivering to a retail store which is at the same location open throughout the day. And to solve this 10 times 10 x complexity, you have one 10th of the time, which is really making all of these decisions, unsustainable to be done by humans. So while previously we were focused on early stage startups, what we realize is that, given the saving percentages, the maximum impact we can bring is in large enterprises with large amount of supply chain, because if we are saving 10%, the absolute value of 10% is much bigger in large enterprises. And that’s one of the key pivots, or the evolution we made throughout the Locus journey. That how from the first three years, while focusing just on the R&D component, the algorithm components, we evolved that research into an end usable enterprise product. Like for the first year of Locus, We had more PhDs than sales guys in the team, we were one of the few startups who were hiring a bunch of PhDs in our early stages, because we like what we understood that the problem is that the theoretical research doesn’t work on the ground, the on-ground complexity is what needs to be solved. And that maths was not available. And we needed to invent that maths and for that we needed to put in that time, right? But in the early days, we were just solving routing as a utility, routing as a problem. Today, We for a large organization, we come in and try and solve their supply chain as a solution.

 

Siddhartha 8:57

Fantastic. And can you share your early journey in fundraise? Like, did you raise the money for Ride Safe or for Locus, the first few dollars?

 

Nishith 9:07

No, absolutely. Very, very interesting question. Because it was a mix of both, like we like we were actually just building out the app. We knew it was a utility, we never knew whether it will be a business or not. And we found some really supportive early stage investors like Sheetal, from GrowX, Manish from Pi ventures. And they gave us you know, like a few $100,000 and broadly said don’t go back to your job. Right. And during the fundraise itself is when we pivoted from a B2C focus, Ride Safe to a B2B focused Locus. And we received absolutely no resistance from our investors. And I think you know, as they say that at that stage, they’re truly investing in the team. I think all of our early stage seed investors really live that and they truly support it. As from, you know, going from the B2C to the B2B side of things. And then within the B2B, you know, during our early series A, Shailesh from Exfinity joined us, right. And with his guidance, as well as patience, we took the step of focusing, excuse me, focusing on enterprises, because enterprises have really long sales cycles. So as a young startup, imagine, you know, putting in nine months of effort in a sales process, where you don’t know whether you will get something or not. And because it’s a much larger company, your entire leadership is involved in that process, right. So it needs a lot of patience. And that’s what we are very thankful to our early stage investors for providing both the guidance, as well as the patience to really build a technology focused, as well as an enterprise focused organization.

 

Siddhartha 10:55

And how was the experience getting your first enterprise, was it Unilever or Blue Dart, which was the first enterprise which you on boarded?

 

Nishith 11:06

I think Unilever would definitely be one of our earliest enterprises and to start Unilever, and it was a roller coaster. It was done, then it was not done, then it was done that it was not done, then it was done, then it was not done. And it was a lot of learning experience for us as well. Because previously, we were used to selling to the teams, which will use us, right, and getting us signing from them. But in a large enterprise, there’s also a full procurement department that you have to deal with. We completely understand the need for it, and the appreciate the reasons it exists. But we had never worked with, you know, worked with them before. So it was a new learning experience for us of the biggest difference basically, you have while selling in an enterprise versus selling in a smaller organization, that in an enterprise, you effectively have a buying committee, right? So you have multiple stakeholders in your buying decisions. Whereas in a smaller company, you typically have a single key stakeholder, if you have convinced that person, that this is a great solution for her or him, it’s amazing. In an enterprise that needs to be a multi prong approach. And that’s that’s a process that’s a methodology that that’s very learnable as well. But the first time it just comes as a slight cultural gap deal

 

Siddhartha 12:31

And or did it take nine months to close the procurement department of Unilever to finally sign it?

 

Nishith 12:39

I mean, not not just the procurement department. But I think overall, like it took us more than a year to really get our first enterprise customer, right. And I wouldn’t blame the enterprise at all in it, because some of the requirements were of that scale. If anything, I would say that we have found enterprises to be very supportive. Like, in our early days, we were not even three years old, which is often a requirement in many large companies to onboard a third party vendor, right, because they have business continuity concerns, then at the same time, the because these are such good businesses, during say the COVID time our our clients more, you know, in addition to our investors, our clients actually reached out and asked us that if we needed additional capital to survive the pandemic, they will be happy to help. Right. Fortunately, we were very well capitalized for the next two years. But it was just really heartening to see that believe that offer you know that that extension of support from our client base itself

 

Siddhartha 13:38

And in your fundraise when did you know Blume and Tiger and Falcon join in?

 

Nishith 13:46

Sure. So we first did a seed stage round where basically Manish and Sheetal from growX sledded. At that point, you know, we got lucky and we were able to onboard some really great angels, like Amit Ranjan, who was the founder of Slideshare. Shubham, who is now a VC with Matrix oncoprotein, who’s the founder of unique armor so we had like this angel round. And then we had an early series A where bloom be next and xfinity joined it. And Shelly Sanjay the we got a great chance to work with them. monition chelation, Sanjay also set on our board so we have been working with them closely. And this was about four years back. Then over the next couple of years, you know, rocket ship, which is anandan Venky. From the valley they joined our cap table. In addition with Pie ventures itself like on earlier it was maneesh as an individual. Then in 2019, at this point, broadly, we had we had reached our first million we had a product market fit We were expanding from smaller customers to the bigger customers. And what was now ready to be tested was will this product expand beyond India? So that time we set out to raise our Series B, that’s where Tiger and Falcon jointed then that kind of product, which is wild designed for the world build from India, will it actually play globally? Right? So will we go to our one to 10 journey, right, and then not be able to just get it from the India region, but globally. So that was what was the aim then. And that’s what we are really focused on over the last two years in 2019, and 20. And today, we have customers, teams and offices present across Jakarta, hoochie Minh, Berlin, UK, US, of course, India, and we have customers in, you know, another 20 countries. So, with more than 50% of our revenue today coming, you know, from outside our home markets. So it’s been Yeah, so that’s been the journey over the last couple of years that, for us, our zero to 1 million mark was making sure that the product is adding value on the ground. Right. At that point, it was all about that, that we were paranoid that people should not buy us just for the sake of buying if they’re buying and using us, or is there a measurable change in their supply chain? So for example, one of the very simple metrics we impact is number of average deliveries you’re doing per day, per week. And automating anything in India and Indonesia is far tougher than doing it and say, Europe or us, right, because the infrastructure is slightly better. So it is zero to one journey, we were absolutely focused on whether the intellectual property can actually add value on the ground, and will people pay for it? We did not really care about distribution packaging, or you know, anything else. The first two, 5 million was building about us sales machinery, building a demand engine, building a product around it, focusing on things like making it easier to intake, integrate, better documentation, better metrics, better tracking, right. And, at the same time, laying seeds for internationalization, both in terms of product as well as GTM. Right. And the journey from there has been making sure that we evolve from a product with predominantly India’s usage to predominantly global usage. Right. And that’s where we stand today. And from here to our 100 million journey, I think executing our international GTM right will play a very key part. We have a product, which really competes really strongly against incubations, which have been playing in decades in a trillion dollar industry. Yeah, so it’s, I think now it’s about us as as Jason Lemkin says, Your first 210 million is about product, and then it’s about distribution. And that’s where we are as an old trying to evolve from a very, very technology focused organization, to a more technology and distribution, play.

 

Siddhartha 18:33

And if you can share a ballpark number, where would be your current ARR, would it be in 20s million, 10s million or 30s million.

 

Nishith 18:40

Yeah, we are in the double digit million range. And right now is when we are basically working out a strategy and resources to take the 10 to 100 million journey.

 

Siddhartha 18:50

Got it. Fantastic. What has been the mindset?

 

Nishith 19:00

No, I mean, no, I was just saying, yeah, that. I think it’s very important. And that’s been my personal goal. Over the last 300 days, that can evolve from a founder to a CEO, right. And I think the biggest and of course, I’m simplifying it, but the biggest change in that is to move from operating from pure passion, to passion plus discipline, right, as an individual, as well as your entire organization. So things like focuses on metrics, focusing on OKRs, focusing on leadership hiring, that becomes an equally big part of my job today. Whereas three years back, 80% of my focus was on product and technology, right? But today, organization design, as I mentioned leadership, which involves leadership, hiring the right matrix collaboration matrix, their own core KPIs, having the right way of tracking them, as well as then interpreting them. Right, and being able to make those decisions. So that’s been the biggest change that we’ve been undergoing. And we want to undergo that how do we grow from a founder to a CEO. And the idea is to also inculcate that further in the team, that ambition comes from disciplined execution, right? Like we are past the stage where we can just go like, oh, let’s do it. Today, we need to have a very clear, committed answer in our head as to why we are doing what we are doing. And that is what will give us the power to sail through tough times, right? If we if we very fundamentally understand that, hey, today, we are sitting at the intersection where there is enough macro demand, and enough data to make our technology solution feasible. Like Locus could not have been invented 10 years back, like the team of Locus couldn’t build Locus 10 years back. And the fact whether somebody will automate end to end supply chain, according to us is inevitable. Right? So if we have that clarity of purpose, that is what will sail us through, you know, the tough days, the tough weeks, and will keep us motivated to produce greatness every single day. And to pass that through the team. Yeah, so that’s been some of my goal focuses and the transition at a personal level on scaling the organization.

 

Siddhartha 21:36

I also observed in your LinkedIn, You have changed from 2014, to founder and CEO to 2020, and from 2020 onwards, only CEO of Locus, that as see as a transition.

 

Nishith 21:54

Okay. I’m not very sure if it’s a conscious transition, or it’s just like, you know, some mistakes while updating some details. I think you always remain the founder, right? Yeah. But yes, right. Now, what I want to say is that, while you always remain the founder, the company needs a CEO. And especially at this scale, like today, we operate teams in like, three different continents in five different cities. So yeah, the company needs a CEO, one should evolve. And we are, we’re seeing the impact of that, like, the kind of effort we put in into planning for 2021 was almost 10X of what we used to do before. This is making sure that our expenses or revenues is far more predictable. And what this does is, this is what really frees up your mind space for innovation. Right, if you’re not worried about fighting fires every single day is when you start thinking about bigger products, you know, non-incremental jumps. So if I’m not worried about tracking every random or, you know, if I’m, if I’m my mental piece, that yes, all the six key metrics are within a 10% deviation level, then my mindspace is free to call up my chief of data science and debate on a distributed mapping project. Right? Otherwise, I will always be paranoid or worried about, you know, what’s the status of that? What’s the status. And while we are far from being done, I think we took a very big step forward in 2020, 2020 was also the year for us to look inwards given the toughness of the year. And yeah, that has made Locus as an organization far more efficient and predictable, which we are really really excited towards, you know, scaling up in 21.

 

Siddhartha 23:56

So, you mentioned a few very key important points. For example, earlier, you are working out of passion now it’s like a lot of discipline has come into your thinking and an action as a leader, can you share some examples of that changes?

 

Nishith 24:19

Previously, for example, when we were building a product like we didn’t need to build it to certain infosec standards and things like our average salary costs were significantly less, Right. So we could we could think about trying out building a completely new module new product, you know, $40-50,000 spent, you know, which gets you like about 2-3 engineers for three quarters in that and they’re working budget, right. But today, we know like our products will take about a year, we’ll take a bigger deal. And they’re typically like a, like, a 750K to a million dollar experiment. If I’m doing that, I want to make sure that I have at least a range of what is my market sizing for it? What kind of customers am I going after? Are those customers common to my existing customers? Else, I need to start a GTM separately, right. So as your scale increases, your cost of mistakes increases. So you want to just reduce the number of mistakes, you can never eliminate them, because you want to optimize for growth, but you want to reduce the number of mistakes you make. Also, in an enterprise company, Any customer facing mistakes have longer sales cycles, which you’re working with customers who would want to grow at 20 to 40%, while as a company, your growth target is 200 to 300, or 400%. Right. So you need to paralyze your effort, and every mistake sets you back by six to nine months. So you want to just make sure you’re reducing them. Yeah. Make. Hiring, you know, is one of those things that you’re always debating that if I’m spending 40-50% of my time in it, am I doing it right? Am I doing it wrong? Right? And the answer is always right, in hindsight and always wrong in the current moment. But yeah, like having the discipline to put that enough attention, you know, to optimize for this comes to very simple tactical things that you know, are you optimizing it for those hiring calls, or you’re optimizing it for sales calls in your calendar

 

Siddhartha 26:33

And what has been the change in how you think about distribution, since its, now, you are at a scale, which, as you said, right, requires heavy focus on distribution.

 

Nishith 26:46

Yeah. So, there has been two key changes in distribution for us, which we are underway of executing one. Till now, we primarily had a central sales team. Now sales comprises of your inside sales, marketing, the actual field sales, customer success solution, so will the sales engineers and solutions who will actually make the thing live? Now till now we primarily had like a central team, which was serving multiple regions, while each of the regions had just local direct field service teams. Now, we are creating an entire full stack P&L in India, Middle East, Europe, North America, and Southeast Asia with each of the regions having their own senior leadership heads, their own customer success, their own deployment teams, their own marketing team. The second critical change has been building a partnership and reseller ecosystem. So over the right, a year back, about 95% of our sales were done directly. Today, about 20% of our sales are done with partners. And over the next two years, we want to take that number up to 50%. Right. So two key changes one making entire region their own autonomous P&L, right, a full stack full stack, sales team for each of those things are becoming a far more so that you know, there is no cannibalization of resources between geographies, like if Europe needs to move forward, Middle East doesn’t need to sacrifice. And the second is sorry, I completely lost the chain of thought like I was saying, The first is on making the entire thing the entire P&L stack. And second, what we just discussed. So the first being on making a full P&L stack to attack the global and second to reduce our dependency on just direct sales to also building a large product partners resellers GTM partner ecosystem. So those are the two critical ways we are deferring in distribution.

 

Siddhartha 29:13

And right now, I believe you would be aiming for a very large round of upwards of $50 million round to take Locus to from current double digit to 3-digit million ARR.

 

Nishith 29:28

Absolutely. Interestingly, we don’t need per se a lot of capital because we don’t burn a lot of capital. We are a pretty revenue generating business and with a lot of inward focus on efficiency in 2020. Last year in 2020, our monthly burn as compared to our monthly revenue is very, very healthy. Having said that, we also think there is solid potential for expansion both in the geographies that we are playing in as well as in terms of certain product acquisitions. So yes, we are looking, you know, at a healthy round, which allows us to go from the entire 10 to 100 million journey without needing any additional capital.

 

Siddhartha 30:10

And tell us about you know, how the culture of Locus has evolved over a period of time?Is there a benchmark which you measure yourself to among, you know, cultural standards that is a set?

 

Nishith 30:25

Absolutely. So, Locus started out by everybody actually living in the same house. And as we, so we basically, I had when Geet, and I started, I requested my then flatmate to move out, so Geet could move in, and we both started working from the hall while sleeping in the bedroom. And we realized that’s a really efficient way of working. So when the third fourth guy came in, we just rented one more flat, and that actually kept going for the first 15 people. And by the end of it, you know, we were almost running like a nine room, fully functioning hotel, with a fully serviced hotel. And so we started out with a really, really close car. Not only did we know each other, we knew each other’s families, you know, each other’s significant other. From there, now we have grown to a team of 200, split across six cities, three continents. A majority of the team focused in stay in Bangalore, with sales teams spread across as I was mentioning a little earlier, in Jakarta, Ho Chin Minh, Berlin, UK, North America, we had three, three very critical things that we always used to emphasize while hiring, which was ambition, commitment, and integrity.

Now, that now, those are not just like, why why, why I’m just hesitating here is that those are not like words, on walls at Locus, right? Those are something that we imbibe in every day, like a designer is completely free and empowered, to go to a skip or a skip skip level manager, or even the SVP of the product, and say that, hey, this piece of my design does not reflect quality, right? Like I am taking a shortcut here that you need to give me time to clear this technical debt, at least within this quarter. Right, I understand if you want to do something for the release. Similarly, you know, an engineering manager can go to the engineer and say that, you know, you’re not building unit tests. And that’s not building integral code, right? Like this is not a QA’s job to find and fix, they’re an additional layer. So what has never changed at Locus is that in a really, really strong focus at technology and innovation, we want to make sure that we always continue to add value for the customer. So our customer success is encouraged to clearly communicate to the customer when the mistake was ours. If we went down, or if there was a bug on our side of the things, they should say that very, very transparently. We fundamentally believe that we are we are an optimizing company Siddhartha right? So we are in a value creating game, in any negotiation of Locus, nobody should walk away unhappy, like this is not like, you know, life is not a zero sum game. There are certain zero sum games, but we are an optimization company. Like even in a pricing conversation, whatever price we are taking from you, you should be saving more money than that. So it’s always a win-win argument. And most zero sum conversations can be converted into, you know, a value conversation. And that’s what we always are focused at Locus, that can we can we add strong, actual, genuine, measurable value to our customers? There is, there are lots of ways to do that. Our way to do that is via technology. So I was very clear, even in school, early days of college that I want to start up. And what I was clear was that about to build a technology startup. I’m pretty agnostic on the problem, like you know, the problem domain we solve for, and we think we think it’s an incredibly hard problem to say make money by selling t-shirts. But that’s not a business, Locus wanted to build. We wanted to be very clear about being a technology not like, you know, technology first startup. Why not because of anything virtuous? Simply because both the founders were personally very passionate and interested in that’s what brings us peace. That’s what really brings us enjoyment. And can we solve a business problem through that? The third was around ambition and integrity. That like it has taken a lot of things from a lot of people like you know, all the early stage, early team at Locus and even the current team, right? Like, no one gives blame us to live a balanced life often, right? We have missed family events. We have missed, you know, births of our nephew nieces. In some cases, you know, closer like we have not been there for our friends and family at times. So it has taken a lot of personal toll from everyone. This is not just a place of worship, this is our religion as well. And one thing, that’s why we strongly push forward to all team members is to build this with integrity, right? You don’t need to pay anything under the table to win a contract to the fact that you should write your own utilities. Right? So integrity goes across every single thing that you do, it is really not about lack of opportunity. Right? It’s about doing things that you do when nobody else is watching. Right? Yeah, so that’s what how I would define the entire culture at Lucas, it’s a very honest, 0 fabs thing, focused on technology, focused on making sure that we are actually adding a value add over any vanity metric, and that we are solving, solving doing that by solving hard problems, right, ambition and integrity is a very equally big component for us, like we are not doing it for doing it doing scale for the sake of scale.

 

Siddhartha 36:28

Good, tell us about you know, some of the recent processes that you have adopted, because now you are a team spread across three continents, and it’s unimaginable to scale without processes, which will be very helpful for the startups which are, you know, seen growing trains to learn from you.

 

Nishith 36:53

So at Locus, we have this concept of yes process but no policy, right. Process and policies are two different things, processes are an understanding, it’s a method, policies are hard rule, right lack of processes, what leads to policy. So a great example being that we have, Locus has an expense process, that you should know what email ID to send your invoice to. But we actually don’t have an expense policy, we trust every individual to judge themselves, what should be fillable? If you file it, we will expense, right, but there’s a very clear portal or an email ID to do that. So that process now one of the processes that we have recently, recently implemented that I’m very bullish on is the entire concept of OKR, objective key results. This is not something very fundamentally different from what many people do, it just structures it often slightly better. What this does is, for us, at least what this does is this, for every individual, this ties, what they’re doing on a day on day basis, to what are the key annual goals for the company? Like at any given point, any individual in your company should be able to answer by doing what they are doing, how it does, how does it help their team? And how does the help out of the team help their company. So we have these five annual goals this year, for example, for each of those annual goals, various department have their own goals, for those goals, individual have their own goals, right. So that was that was a big process that we spent a lot of time in last q4. And this gives this gives apart from tracking and alignment, which are the very obvious gains from it. This gives a lot of purpose to every individual in your team, which I think is very important, as you scale the team. See what happens is when you’re 30-40-50, even the founders are just on an everyday basis interacting with everyone. So everyone knows exactly why they’re doing what they’re doing. But that is the part that gets lost when you’re scaling. And that is really, really important. And you know, so like, for example, last q4, during the festive season, we wrote a custom letter to each of our team members’ family, that how their team members are helping their teams and how their teams are helping their company. Right? If everyone in your company can answer these two questions at the drop of a hat and answer it even better, hopefully in terms of metrics, then I think you’ve done the OKRs right.

 

Siddhartha 39:32

And where did you learn this, OKRs from? like, did you learn it from a book or you hired organization or a mentor to teach you the OKR system.

 

Nishith 39:43

We learnt with readings online, like you know, the founders themselves have put in a lot of like, you know, guys who made OKRs and it’s like solid companies starting from the days of intel, right? They have put in themselves their views. It’s It’s It’s Yeah, it’s understandable. I’m sure we could have benefited from an expert. But at that point, yeah, we thought this is something we want to understand first ourselves very deeply. And we did it ourselves.

 

Siddhartha 40:11

There’s a legendary book on OKR called by John Doerr Measure What’s Matters

 

Nishith 40:15

Yeah, yeah, that’s the one we followed as well. Right. Like, that’s what like, it’s some really, it’s really great books by the people who came up with this. Right? So you have their first motivations, right? I mean, we answered every single thing in it, right? So for example, over there, that book on Google, it mentions that in Google, they don’t link OKRs with appraisals, because that impacts ambitious goals. We haven’t done it that way. Right. Now. We have linked it and we are more like, you know, it’s fine if you read 70-80%. But what do you do should be linked? Yeah. So those are things that we would also love to debate someday with, you know, somebody who has far more experience implementing? Yes, it’s not a perfect implementation the first time. But yeah, getting started is better than not having it. Yeah. And I’ll see the whole, the whole, you know, as the other book by Ben Horowitz says that, the hard thing about hard things is that there is no pattern. And that’s the difference say, you know, between building your company and building your body, I think both involve a lot of hard work, and one should not trivialize any. But in the first one, there is still relatively a playbook available. In the other one, you know, you need to make sure that you’re making decisions which are relevant to you, at that point in that situation, which might be unique.

 

Siddhartha 41:52

And, you know, one last question, you know, before we conclude the podcast, what are the resources that you have leveraged, or books that helped you grow as a CEO?

 

Nishith 42:07

I used to read a lot of Paul Graham essays, right. And that’s what gave me a lot of guidance, in starting up itself, like in the entire zero to one face. I think one of the things that really helped me were all the long form essays by Paul Graham, right. Including things on you know, tangential topics, like popularity lists, everything. But those PG essays were really, really helpful, I think, from the one to 10 journey. Now, this not a really a book on startups. But there’s a book called Man’s Search for Meaning by Viktor Frankl. It’s a very intense book, it’s a small book, 100 odd pages types. It’s about the holocaust and the prisoners of war. And it talks about a concept called Stockdale paradox. This concept is also quoted by Jim C. Collins in Good to Great. And that’s something that has stayed with me a lot and has guided some of the daily things. What this talks about. So during the prisoner of war, the people who never came out, were both the optimist as well as the pessimist. Like, what, what it required to survive, that is a reality check that, yes, my current conditions are tough, it will take me a lot of effort to get out. But I will get out and once I get out, it will be worth it. Right. So having that having that courage to accept the reality as is. And then having the faith and optimism to you know, build and come out of it. I think that’s that’s really important. Having like blind optimism that, you know, oh, competition doesn’t matter. Nothing else matters. And everything will be good. No customer will ever churn. No team member will ever leave. I think that’s also very delusional. And obviously, pessimism is not something any founder can live with. So having that right balance and yeah, or just knowing that there is the need of that right balance, right. So just that small piece of reading really stayed with me.

 

Siddhartha 44:29

Fantastic, Thank you so much Nishith. It’s been wonderful to have you on the podcast, you know. So complete honor to learn from you and to share those learnings with the listeners.

 

Nishith 44:42

Absolutely, Siddhartha. Thank you so much. It was an absolute pleasure talking to you and thanks for taking the time in doing so.

 

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