Digital tech startup I-Life aims to bring affordable laptops to India

Deepak Bhatia, founder of I-Life, has taken affordable PCs and laptops to 43 Asian countries, and now wants to focus on Make-in-India.

At a Glance:

Startup: I-Life Digital Technology

Founders: Deepak Bhatia, Anees Mian

Year it was founded: 2012

Where it is based: USA, Dubai, Bengaluru

The problem it solves: A electronics brand that builds and supplies low cost laptops and tablets

Sector: Electronics

Funding: Undisclosed PE round

Deepak Bhatia, who was raised in Dubai, worked in the electronic retail sector for about 14 years. In 2012, while he was distributing electronic goods in Africa, he realised that certain brands were charging way too much for their laptops. It was here the idea to start up was born.

“I realised that the prices were 1,000 percent more than the manufacturing cost. These products were expensive for any developing country. That’s when I decided to start up,” says Deepak Bhatia, director and founder of I-Life Digital Technology.

To address this gap in the market, Deepak caught the next flight to China and found a few manufacturers who could manufacture the most affordable smartphones, laptops, tablets, smart watches and virtual reality gear. Here, he realised that all he had to do was manage the quality and ensure there was a clear supply chain organised to ship products to every country that he was planning to expand to.

To set up his company, he first roped in quality-control experts from his operations network, and asked them to verify every product manufactured in China. In a couple of months, he had spoken to a few retailers about selling affordable devices that would enable young people to experience high-end electronic items.

“I started I-Life with that purpose. Along with my partner Anees Mian, we created a brand and started building a distribution network across Asia,” says Deepak.

The beginning

Deepak has good knowledge of the retail space because he comes from a business family. “I had worked with people of different cultures, I knew how electronics was sourced and distributed, and to top all this, I worked in the retail sector for a decade and had understood how to build private brands,” he says.

Since he was aware of the entire chain of operations, he just decided to spec the product by himself and find a balance between the most-expensive and premium products. He talks about his experience in Iran, where he supplied private labels on behalf of a retailer that he worked for. This thought him how products are sourced from manufacturers in China and shipped to retailers. "If you want to enter a business, then you have to observe these nuances of sourcing and supply chain because that is the foundation of any business," says Deepak.

The business model

The first business plan was to sell 10,000 laptops worth $200 each, and the company exceeded the target in the first year itself.

I-Life claims that most of its products are priced in the range of $90 to $600, which makes it one of the most-affordable electronic brands in Asia today. I-Life sold close to a million devices in 2017, and Deepak says investors currently value the brand at $200 million.

According to sources, the company’s revenue stands at $30 million, but there is no official confirmation as the company did not want to disclose the numbers. It was bootstrapped in the first year, and Deepak realised that if he kept the cost of sales low, it would bring in more revenue.

The challenges, in the first year, were to get their first client. Deepak met at least 40 top retailers in the Middle East and Africa region and all of them wanted an upfront deposit, which was around $1 million. But, any experienced entrepreneur will tell you, if your network is strong then there are enough businesses that support you. In June 2013, things started to change. The products were ready to be shipped from China and Deepak had convinced a retailer in UAE by then.

His first client was Jumbo Mall, which supported the startup in Kuwait, Qatar, and Oman. Interestingly, Deepak registered the company in the US – since the design team operates from there, and in 2016, raised a large round of funding from a private equity firm (undisclosed) in the Middle East.

“I did most of the marketing and hiring in the first year. The product was a success because it weighed only 1.3 kg, and had the best specifications for a low price,” Deepak adds.

“We design the product with a focus on Indians living in Tier-II and Tier-III towns,” says Deepak. He spends every fortnight in India to build an ecosystem of 4,600 customer service centres or touch points, which are around 100.

Market overview

According to IDC, the premier global market intelligence mark, the Indian PC industry saw 12.7 million units being sold in 2017, compared to 110 million PCs sold in the US last year.

I-Life is currently available in over 43 countries and has recently entered Turkey and South Africa. The company today is a 300 member team.

The company plans to venture into modern retail in India by the end of the year, and will be partnering with Croma, Reliance Digital, and other key organised retail chains. The company is also looking to manufacture its laptops under the ‘Make in India’ initiative.

“We’re now analysing what kind of costs, investment and benefits are there to make at least an SKD (Semi Knocked Down) unit in India – either directly or as an outsource. If it is outsourced, then I wouldn’t consider it as 100 percent ‘Make in India’. But we’re looking to do it ourselves so that we are in full control,” Bhatia says.

The company launched its products in India in 2018, and has an exclusive partnership with Flipkart, where it retails its products. The pricing in Flipkart is between Rs 10000-Rs 15000.

The product offerings for the company in global markets are:

• 15 varieties of Lap tops that include ZedAirPro, Zedbook Wifi, Zed Air and ZedNote.
• 15 varieties of tablet that include tablets designed specially for children with specific colors and is called the KidsTab5, 6 & 7.
• It also smartphones, watches and VR gear.

Currently, the PC market is dominated by HP, Lenovo and Dell. The consumer PC market recorded an overall shipment of 1.08 million units in Q1 2018, with 10.9 percent sequential decline, and 3.2 percent increase compared to the same period last year. “The general economic and employment scenario continues to remain pessimistic, which has impacted the consumer spending," says Manish Yadav , Associate Research Manager, Client Devices, IDC India.

Talking about his future plans, Deepak says, with the private equity round, he is no longer the majority shareholder in the company, but he hopes to build a business that can scale to $1 billion in revenues in the next five years.