Starting with Rs 1 lakh, how this 23-year old built an influencer marketing startup raking in Rs 50 lakh a month
Influencers have the power to sell products, ideas, and services. And, that is one of the reasons brands for many years now have been looking to celebrities and sportspeople to endorse their products and services. In today’s day and age, the influencer community largely resides and wields power in the social media space.
The number of followers influencers attract and the activities they engage in have completely changed the ways of marketing communication, with this evolution reflected in the offline world too.
The power of an influencer was something 23-year-old Gautam Maadhavan observed at an event in Delhi. At a conference, he saw numerous delegates had come to listen to one speaker on a panel. He recalls,
“I wondered, if one individual can impact a handful of audience, what if we build a community of people that can engage a much larger audience at once? That's how MAD Influence came into the picture and we started it in January 2018. Since then, we have onboarded over 8000 content creators across India from multiple networks including Facebook, Instagram, TikTok, YouTube, Twitter, etc.”
Starting out in Delhi, MAD Influence now has offices in Mumbai. Gautam, the sole founder, runs a team of 15 people in Delhi and four in Mumbai. A BCom graduate from Delhi University, the entrepreneur has been associated with the student organisation AIESEC and worked with WeChat.
The team and what they do
The core team comprises Manav Mehra, who is ex-Standard Chartered Bank and the CFO, Aman Narula, a botany graduate and the Senior Influencer Manager, Shivam Shukla, a BTech graduate and the Strategy and Partnership Manager, Srishti Bhatia, a graduate of Amity University and the Digital Community Manager, Shweta Sachdeva, Influencer Marketing Manager, and Lokesh Sharma.
MAD Influence provides brands with solutions to market their products or services through influencers. “We first try to understand what the brand wants to promote and what the existing communication is like,” explains Gautam.
Based on the first interaction with the client, the team makes a detailed plan. This includes determining influencers in different online and offline integrations along with plans for other add-on channels like PR and media buying, which are outsourced.
The team began with sourcing influencers with a presence on social media and establishing relationships with them. Then, they focussed on working with brands and clients and bringing the two together.
The team claims to have worked with the likes of Dharma Production, TikTok, ALTBalaji, T-series, Vivo, Pen, Hotstar, Alibaba.com, HCL, and Sony Music, to name a few. The clients are provided real-time reports of engagement and impressions throughout the period of the contract.
“We provide real-time analytics for all the promotions that we do with each of our influencers with our integrated artificial intelligence tool built into our platform. This enables brands to access and choose between thousands of influencers with just one click,” says Gautam.
Completely bootstrapped since its inception, Gautam says he began with a Rs 1 lakh loan from friends and family. The company has benefitted from the largesse of Gautam’s friend, Laksh, who has provided the office space without charging rent. This has significantly helped reduce costs.
This business model works on two parameters — agency commission and advertising fees. The team charges commission from the influencer on every deal they get, and they also charge the client a premium for the services rendered. “For other services like video production, content writing, etc, we charge as per the market standards,” explains Gautam.
The team makes a margin of 25-30 percent
He shares that the revenue clocked in the first six months was Rs 10 lakh, which went up to Rs 20 lakh in the next six months. In the first quarter of 2019, he claims, the startup has registered revenue of Rs 60 lakh, and in the first quarter of the financial year it hit Rs 1.2 crore. Gautam says they are now doing monthly fees of Rs 50 to 55 lakh every month.
The space and future
There are several startups in the space of influencer marketing. In Bengaluru, for instance, there is Winkl, founded by Rahul Singh and Nikhil Kumar.
According to Mediakix, this market is all set to reach $10 billion globally by 2020. In India, the segment is yet to grow to those proportions and is categorised under the $1.5 billion digital spending market. Nevertheless, the growing traction of influencer marketing is giving rise to a large number of budding and aspiring influencers.
“In terms of brands, we're already catering to the Fortune 500 like Puma, Idea Cellular, Colgate, etc, and also the upcoming startups in India like Oyo Rooms, Club Factory, and Alibaba.com. Soon, we are planning to build a sustainable yet affordable solution for every brand that enters India,” says Gautam.
(Edited by Athirupa Geetha Manichandar)