In Conversation with the Founders of i7 Networks [Post-funding Interview]
Manjunath M Gowda, Chandrashekar Munibudda and few other co-founders who had previously setup S7, a service and product based company with complete focus on software migration which was acquired by Bluecoat Systems, a Californian company in Jan 2010. Now, as their next venture, they founded i7 networks. It offers Indian companies a suite of products that helps manage their web content classification and bandwidth management to analyze and measure throughput and to further shape and configure for better ROI. After their recent fund raising success, YourStory.in caught up with the folks at i7 and had an interessting conversation on their journey so far.[Edited Excerpts]
YS: Given your S7 experience, how was the fund raising experience this time with i7 networks?
i7: During S7 days, it was almost impossible to raise funds. No one would even give time to talk, forget giving funds. Accidentally as they say I met Rao and somehow after a long and tough period along with very frequent meetings, he invested in S7 and reaped huge returns (after S7 got acquired by Blue Coat Systems in Jan 2010)
i7 was totally a different experience. People were more than willing to give time and ear and ready to invest. As Spielberg once said, a great movie making is 80% casting. It is the team usually that matters more than ideas and I believe this strongly. So S7 founders joining hands again to start another venture gave investors’ confidence. Nevertheles,s we didn’t want to go to new investors and stuck to those with whom we had a great working chemistry.
YS: Briefly tell us about the investors on board and the value-add they'll bringing apart from the capital.
i7: We have three investors – Sharad Sharma, Rao Remala and Murali Venkat Rao.
Sharad Sharma requires no introduction in the Indian software industry and we are very lucky to have him as an investor. His feedback, his analysis and his understanding of the market is just amazing. We are blessed for sure.
Rao Remala is very famous for being the first Indian employee at Microsoft US and was interviewed by Bill Gates himself and joined MS as early as 1981 I believe and of course he was part of all later Windows releases, he owns lot of patents etc. But more importantly for us he is part of a bigger angel network in Seattle area and he is well connected within the software community and will be of great help for us.
Murali on the other hand is also from Microsoft. He joined them way back in 1991. He had tremendous experience in what it takes to get a new product to market, what it takes to make it successful and also knows how to control the complete life cycle of a product.
Between the three I think we have huge experience of developing, marketing & selling the product in the global market. We are very lucky to have such a group of investors.
More than all we have a great working chemistry with all three of them which dates back to several years.
YS: How do you intend to utilize the capital raised?
i7: We have raised little over quarter million dollars and this adds to already funds invested by the founders. Yes we have today decent money in the bank. Now we can all concentrate on getting the innovative product out to the market and winning the customers and not worry for quite a while where the money is going to come from. But remember there is a famous quote, “most companies die out of indigestion rather than hunger” – we have to be very careful and not fall into this death trap. We will continue to work with the same hunger we had before the funds happened and that is very critical. It is the customer money which says you have won the race and not investor funds. Investor funds are more like vitamin shots which might help you win the race but you still have to work very hard to win the race.
Surprisingly we got our product EagleEye the bandwidth analytics tool enterprise ready, we even won the NASSCOM’s prestigious IP4Biz award and we have many POC/ Eval sites and they are all very happy but they need some enhancements and new features. With this in the background, we will use the funds to hire a seasoned sales person. With plans to add few innovations and enhancements in our product, we want to hire few real smart engineers including few very smart freshers & interns into the team. Of course our marketing investment will increase further.
YS: How do you see the network/communication channel throughput analysis and optimization market evolving in India and abroad?
i7: We basically play in the Analytics market – to be precise internet bandwidth analytics. In India, we have seen that financial services are asking for such ultra-grain drilled down bandwidth analytics for security, forensics and for billing purposes. Defense and government agencies are showing interest because again of drilled-down analytics and for our real-time and retro analysis of data including geo classification of IP addresses for noting down the source of any attacks. And for obvious reasons; there is lot of interests from BPO industry to make sure they have a very good control of what is accessed and what is not and for compliance purpose. E-Commerce companies are interested to see what the traffic is like, from which geographies most traffic is originating from etc. Many 100+ strength enterprises are also showing interests for the product to see how they can manage their internet traffic better, better visualization and do better capacity planning and helps them cut bandwidth costs. There are lot more scope across many industries from manufacturing to educational institutions but market needs to be developed there on how analytics can be used for predicting behavior and how to use it to make intelligent decisions, which is pretty common in the western world. We see this market growing in India at a very good CAGR in the years to come as we narrow the gap with the western world in technology adoption for better growth and results.
We also have come out with a what I call “the Shampoo-in-a-sachet model” of giving out our product EagleEye (which is loaded on an appliance) on a lease/rent model so that even Indian SMBs (what we call iSMB) who are shy for big capital expenditures, can now afford to have this boxes at a very minimal cost per month. If not anything, they can start to at least know their bandwidth capacity and cut down additional bandwidth costs which can spiral from few lakhs to few 10s of lakhs. All this can be saved at a fraction of that cost to be paid every month (pay as you go model). This will save SMBs from high capex cost but still take advantage of the technology.
In the foreign markets like Africa, Middle East and few regions of Asia, we have seen that the bandwidth costs are very exorbitant ranging from 40X to 100X compared to US rates (measured as cost of $ per mbps/month). Any technology that helps cut bandwidth cost are more than welcome. Currently we are working for partnerships over there and if you are the one and reading this, we would love to talk to you.
In western world, universities, high schools and small or medium sized cable operators, ISPs, telecom providers etc. need this product to better understand their customer needs, devise better subscription and payment plans and of course to meter the usage. We have tied up with a European distributor and he sees a huge market there. We are in talks with few US distributors. Now you are already getting a feel of where we are putting our funds.
YS: Where do you see i7 networks three years from now?
i7: Very tough to answer to be frank with the way software industry and in general the market is changing. But one thing for sure we will be there and will be giving the best we can today and in three years.
Nevertheless we do have plans. We will be all over analytics and we have some very innovative plans & analytics to get into BYOD issues, the video analytics, the social analytics and the cloud analytics. We are already working on how to get under the skin of each one of them and what is the next wave we can create in each.
We are also thinking on what next after analytics? What actions can we do from these great insights we get? We have plans to write real smart complex algorithms to use this data and show how exactly to size your bandwidth and do better capacity planning, how can you predict the next network attack, from where and how to preempt it, or how exactly you can help network optimizer companies on what to optimize especially the way video/ streaming bandwidth usage is growing etc. But one thing is for sure we will not reinvent the wheel. We will not do what a firewall or a Wan Optimizer or a caching box do but we will work along with them so that we can provide the intelligence from these analytics which they can push into their boxes to do what they do best. Remember heart surgeons are good in heart related issues and should not go and fix the knees and if you do, you mess up both and of course vice versa applies too.
YS: Are you guys looking to expand - locations, team size?
i7: Definitely, we will increase our engineering team for sure considering we are jumping into video, BYOD, cloud and social analytics. We will expand the sales team. We are not expanding locations per say for now and we will prefer partnerships across locations. We intend t0 partner with channel partners across India and across the globe.
Want to know more about i7 Networks' products? Take a look at i7 Networks on YourStory Pages.