Bharati Jacob has been a part of India venture investment story since its early stages. Her acumen for identifying opportunities has been honed over a decade of watching various companies go through their evolutionary cycles. In a conversation with YourStory, Bharati shares her experiences on board the (red)Bus.
It was early 2006. Seedfund’s Bharati Jacob was trying to book a bus ticket to Ooty, much before she actually met with redBus's co-founder Phanindra Sama. She googled for “Bus tickets to Ooty” and didn’t find any relevant results (a search which reflected on the redBus analytics). She pondered about lack of options for online bus ticketing, while trains and flights were getting booked online. We could call it serendipity that Bharati met with an entrepreneur who was trying to solve the very same problem in November that year. Let’s now listen in to what Bharathi has to say.
“I instinctively liked Phani. The fact that he was already thinking big, and you could tell that he was genuinely a good guy. Since I personally faced this problem before, I could completely relate to what he was trying to do. I first heard of redBus through TiE – since TiE had run a EAP where I was to participate as well (I couldn’t as I was traveling and Samir Kumar of inventus shared his notes with me and that’s how I first heard). Since I had faced the problem, the value proposition spoke to the consumer in me. We did the first round in February 2007 and the second round in May 2008.”
Get the Basics Right
Phani and his team focussed on the basics from Day 1. Keeping the bus operators and consumers happy has always been the single most important thing for them.
I remember, once Phani’s early team member Abey got a call from a customer (a senior IT professional) who missed his bus due to some last minute cancellation. Abey immediately booked a flight ticket for the customer, picked him up from his place and dropped him at the airport. Going the extra mile was part of the redBus DNA from the very early days. What experience you are giving to your customer was always the top priority.
Every person in your team helps build the brand by little actions like these, and not by ad spends. And, we advocate our companies to be frugal and get the basics right.
Also, brands built on advertising don't last long. Someone can always overspend you. IP is not just built with technology, but your IP is also built by how you think and build your customer experience. There are no shortcuts to this. Providing a seamless brand experience to your customers has to be in your DNA.
Also, early on sometimes,first-time entrepreneurs get worried about ad spends, but ad spends have nothing to do with branding. Brands are built by constantly asking and then delivering the right experience to your customers. This is what stays over the long run.
On Phanindra Sama and redBus team
Phani was always willing to listen and learn. He always spoke to a lot of people and constantly absorbed knowledge like a sponge. When you are young and a first-time entrepreneur, this quality is extremely important. Some of the entrepreneurs get defensive and think that they know the market better as they are very close to the market, but this is a classic mistake. Sometimes distancing yourself and paying attention to what others are saying can turn out to be critical.
Early 2008 was a crazy time. The market was frothy; everyone was quoting high valuations, though no one would write a cheque. The entrepreneur then gets into a dilemma about things. It was important for us as investors to keep things in check with respect to our portfolio companies.
Experiment, Fail, Experiment, Fail, Experiment, Succeed
It is important to quickly figure out the pillars of your business model. Experiment a lot, figure out what is working and what is not, very quickly, and move on.
The quality of your early team is extremely important, when you are just starting out you need to have a team that is extremely entrepreneurial. Being entrepreneurial is a mind-set, and your early team has to be multi-tasking and doing everything it takes to scale.
Figure out how you will make money early on. However, you do not have to start making money from day one. But, at least have an idea of where your money will come from. Most entrepreneurs are driven by their idea (which is actually the right trigger), but the business viability of the idea needs to be clearly articulated in their minds, else it leads to a lot of heartburns later on.
Clarity of thought is very important. Clearly define the problem you are solving.
Investors’ Role in a Venture
The biggest role of an investor is to help make the founding team believe in themselves and achieve what they are set out to do. Sometimes making people believe in themselves creates a huge leap in the ability to perform and scale.
Most of the time, the entrepreneurs need this push. All of us need this push. Our job is to help create an environment where they can grow and do what they have set on to do.
For an entrepreneur to scale his/her venture, they have to believe in it completely. Sometimes,the "thinking big and scaling mindset" might not be there from day one, but it develops over time. Our job is to push those boundaries.
Big Hairy, Audacious Goal
India has a lot of problems. I think entrepreneurs are the ones who are going to make this country better. By identifying and working with some of the best ones, I think I am playing my tiny role of doing something for our country. And continuing to do that is my biggest driver every day.
Phanindra Sama on Bharati Jacob
“We have had very memorable association with Bharati, our first investor. She got the humane angle to our board discussions. She's the investor who, when we asked for Rs. 30 lakh funding, worked with us to revise our business plan 7 times and arrived at a funding need of Rs. 2.5 Cr! Bharati has been supportive of us in our tough times when we slipped on our targets. On a lighter note, many of members of our Senior Management who met Bharati during the board interview round say that it was the toughest of all the interviews. Besides many other things, the biggest of the value adds is Bharati's ability to connect us to the right people. Bharati is very well connected and she was able to connect us to just about anyone in the industry.”