'Funding is not always the correct answer' - How Desidime bootstrapped for 4 years
DesiDime.com was born out of a failure to launch a daily deals e-commerce site which intended to give a fresh deal every night at midnight. The entire tech platform was ready with gamification surrounding colours to bring in even more excitement at 12 a.m. for users. It was early days in 2010 when e-commerce was rare and daily deals sites like MyDala, BindaasBargain, Snapdeal (yes, it was a daily deals site too!), Taggle and many more mushrooming. Being in USA, I had no access or ability to meet merchants in India and a friend of mine suggested I should start something to market my e-commerce site in the future. Being the tech and product guy, I loved building things. I started wondering if a forum for shoppers would help me understand the pulse of e-commerce industry in India. Within three days, I got the first version of DesiDime.com forums out with the help of open source projects. It was the most exciting time for me, sitting in a Chicago Starbucks for three consecutive days and getting the product out over a long weekend.
Finding the Perfect Co-Founder!
A week passed and no one commented on the forums. Some of my good friends and relatives signed up, congratulated me and gave me inputs on aesthetics, UI and so on. As a techie, one always ends up thinking that just building the perfect product is everything, but there is always more. One of the early users (User Number 20, to be precise) who signed up was my cousin, Mehul Jobanputra, who is now my co-founder. He started sharing a lot of suggestions as he understood what I was trying to do. It suddenly became very interesting to discuss problems with him, how to monetise in future and so on. He came from a consulting background and had a different personality so we complemented each other well. We still continue to have different opinions but that helps us make good decisions and learn from each other.
Our first user
We started researching on affiliate marketing (neither of us knew much about it back then). We started talking to each other on the forums with kind friends helping us keep the conversation going. But suddenly we noticed our number of comments going down. I asked Mehul about a particular commenter who I thought was his friend. Mehul thought it was mine! We then realised we had our first user talking in our forum. Our user had some difficulties placing an order at Domino’s and we went out of our way to help him out. I remember spending a good 10 minutes to draft the perfect reply and leave a good impression.
After that, more users started joining in and talking to each other but sharing few deals. We thought of adding some gamification around it and launched ‘Dimes Reward System’ wherein a user would be awarded one dime for sharing a good deal. We then found a few users misusing the system and so added a daily cap. We did not have any business plan till then but we started understanding what users wanted and built features around that. Mehul started looking around SEO, affiliate and digital marketing and I continued with building the product.
Show me the money
We then launched something which would automatically monetise links which users are sharing in forums. We rolled it out but made no money for 15 days. Everyday, we would log on to Flipkart affiliate panel (Flipkart was the first e-commerce company to take affiliate marketing seriously) with a glimmer of hope, but then get dejected and get back to work. Mehul thought there were probably technical issues and decided to buy a new mobile phone on Flipkart.com, by clicking on a link which one of the users shared. He checked several times through the day, but could not figure out what was wrong. I then got a call at three am in the morning from an excited Mehul. We had made our first Rs. 168 in the Flipkart account.
More Users and FPD
We started ranking on the first page of Google for "online shopping community" and “buy-one-get one Domino’s Pizza FREE” being a hit among youngsters got us more traffic. People started interacting even more. We understood early on that serving the community is important and so is building trust. We started showing the best deals on our home page and ensured that they are actually value for money before promoting them on the front page. One of our core values is to not promote deals to earn more money. We make sure only the best deals are shown on the home page and people started referring to them as FPD. We got many offers to have paid placement within FPD but we turned them down no matter how lucrative they were. We got moderators; the community started growing; we turned profitable too and the entire concept and vision started working.
Moving Back to India and our first angel round
The concept was proven: we started making Rs 5,000 every month (even though an insignificant amount for both of us to meet ends). I shared our startup story with my colleague and he immediately mocked my earnings and said it’s a good side business. “It does not make sense to leave your six-digit salary in dollars and a secure job for getting Rs 5000 every month,” he said. Mehul had similar stories. But we were determined and definitely sensed the need for a shopping community in India.
Soon the word spread within my office and my CTO, Mark Friedgan, learned about our "side business". He emailed me late one night saying he wants to talk with me the next day. Around that time, I was also considering leaving the job. When I met him he congratulated me about the startup. He was excited about the idea and the product which we had built so far. He motivated me to work part-time from India at almost the same salary as I drew in USA to make bootstrapping easier. This helped changed gears and our self-confidence grew.
I moved back to India in March 2011 and Mehul continued to work at Universal Consulting so it made it easier to fund the startup. I worked the whole day on Desidime.com and then worked four hours in the night for Enova Financial. We got our first office and our first four employees (three of whom are still with us). We managed to pay office rent and salaries. Neither Mehul nor I drew a salary to remain profitable as a company. Mark again surprised us and asked us to quit our jobs and said he would put in an angel round of funding to fuel growth. Mehul eventually quit his job in October 2011 and I left my part-time job too in December 2011. We focussed full time on the product, started hiring and there was no looking back.
Lessons learnt in last four years!
- Never give up! Just when it seems impossible, you are almost on the step of success.
- Funding is not always the correct answer for all businesses from Day One (Community building, for example)
- Profitability is good but not at the expense of growth.
- Getting the right people at the right time. We would have never reached here without our 52 co-workers.
- Business plan is good but pivoting quickly is equally important. Keep your ears very close to the product.
- You will make mistakes. Admit it, correct yourself and move on.
- It’s important to speak up and be vocal about the product.
- Never cheat your customers who have put their trust in you.
Fast Forward to 2015
Five years later, we have now grown to three products (DesiDime, Cuelinks and Zingoy) and a 50+ team of talented individuals who joined us along. Being profitable from almost the first month, we did not raise any round of funding. Being profitable was an important goal for us but not at the expense of growth. It is always difficult to bootstrap when every one is raising big rounds of funding. We knew it was not the right time to raise a funding round as we had three products and wanted to give justice to all of them. Building a community cannot be just solved with a supply of money. Definitely not in the initial stages, at least
Sometime around last year, we realised we were ready to grow faster and decided to meet investors who had contacted us over the last three years. Around the same time, we met Paul Nikkel (Founder of HotUKDeals.com) and Fabian Spielberger (Founder of MyDealz.de) in Germany and over an inspiring dinner. We discussed our vision, how they have been building a shopping community for the last 10 and seven years respectively (as I said before, building a good community is hard: it’s not a funding game but requires dedication, hard work and perseverance), the problems surrounding affiliate marketing and so on.
We met them several times later and it was inspiring to learn about the vision of Pepper.com, which is the world's largest shopping community with the deal websites it already has. Pepper is present in UK (currently as hotukdeals.com), Germany (currently as Mydealz.de), France (currently as dealabs.com), Mexico (currently as promodescuentos.com), Korea, Poland, Netherlands and USA. We decided to join them as we connected quite well and shared the same vision.
Pepper currently gets over 450 million page views, 25+ million users, a hyper buzzing community across all the 10 countries on various deal sites making it the biggest social commerce site on the planet.
DesiDime's merger with Pepper is the beginning of journey to not only be the biggest shopping community in India but across the globe. We aim to move to a common platform Pepper.com across the globe and bring more utilities to shoppers to find, communicate and share the best deals. Merchants would also get benefitted from advanced user profiling and ability to target the right shopping deals at potential customers.
About The Author:
Jimish Jobanputra is the CTO and Co-founder of DesiDime.com, India’s largest online shopping community to discover the best deals and coupons.