From a Wall Street trader to an entrepreneur, the journey of Gupshup Co-founder Beerud Sheth
In this week’s 100x Entrepreneur Podcast, Beerud Sheth, Co-founder of Elance (now Upwork) and Gupshup, sheds light on his journey from Wall Street to building a profitable smart messaging startup.
The story of Beerud Sheth, Co-founder and CEO of smart messaging platform, is not that of a typical Indian engineer. After studying Computer Science Engineering at IIT Bombay, Beerud got into a flight to the US and paved his career path.
An alumnus of Massachusetts Institute of Technology (MIT), Beerud kick-started his career at Wall Street. He worked for the Citibank and later for Merrill Lynch, where he modelled securities and traded them as well. He considers this as his business school experience that eventually led his way into entrepreneurship.
In 1998, Beerud went on to Co-found Elance (now), which pioneered the gig economy.
In the recent episode of 100x Entrepreneur Podcast, a series featuring founders, venture capitalists, and angel investors, Beerud spoke to Siddhartha Ahluwalia and discussed his journey spanning across 22-years, from Mumbai to Wall Street and ultimately leading to the starting up of Gupshup.
Wall Street to entrepreneurship
Beerud was at Wall Street when the internet was just booming. Companies like Amazon, eBay, and Google were making headlines, and Beerud did not want to miss this opportunity.
But soon, the market was in the midst of a currency crisis and the Wall Street was in a lot of turmoil and disruption. During that time, Beerud was either investing in public companies or brainstorming new ideas with friends. “I loved the business aspect of technology...I was itching to do something,” he says.
It was then that Beerud, along with his classmates from IIT Bombay -- Srini Anumolu and Sanjay Noronha, started Elance, an online freelance marketplace that eventually became Upwork.
The three co-founders leveraged their connections and raised about a million dollars from angel investors to get the company started. “It was a rollercoaster ride,” Beerud recalls.
The trio started Elance in Sanjay’s two-bedroom apartment, which served as an office during the day. The company then grew to a team of 20 employees. For its initial users, Beerud reached out to his juniors from IIT Bombay and offered them freelance projects during their internships.
“They loved the idea. Sitting in Mumbai they could make money in dollars, it was a great idea...and this was the earliest validation,” Beerud says.
In 2014, Odysseas Tsatalos and Stratis Karamanlakis started a company called oDesk, which was focused on the gig economy. While Elance focused on fixed price projects, oDesk differentiated itself by focusing on hourly projects. Both the companies were growing while competing with each other. Thus, in 2014, the two Boards decided to merge the company.
In 2015, the Elance-oDesk merger was rebranded as Upwork. Upwork went for an IPO in 2018.
After leaving Elance, Beerud was approached by Rakesh Mathur, an accomplished entrepreneur in the Silicon Valley. The duo came together around 2014-15, and started Webaroo, an offline search engine. The idea didn’t work and the team pivoted the startup.
Around 2007-2008, when the mobile phone became revolutionary and experienced mass market adoption, Rakesh and Beerud decided to leverage the power of SMS and rebranded Webaroo to Gupshup.
Gupshup was almost like Twitter.
“Users could publish their thoughts like tweets, and people could follow them and receive messages,” Beerud explains. Gupshup grew to 70 million users in India at a time when Facebook and Twitter had only one million users in the country.
However, Gupshup was way ahead of its time. First, it was subsidising all the traffic, meaning the company was paying for all the SMS. “Initially we thought that as the volume increases, the prices would go down. But for a variety of reasons that didn’t happen,” he adds.
Secondly, for regulatory reasons, Gupshup could not advertise. “We were in a situation where we could not subsidise nor monetise,” Beerud adds.
It was then that the company pivoted from a B2C model to a B2B model. Today, Gupshup is a sizable enterprise messaging platform and has been scaling since, generating over $100 million in revenue. It has also signed a partnership with WhatsApp for business.
While companies are vocal about valuation and raising funds, Beerud prefers to remain quiet about his company. Gupshup last raised a $10 million investment in 2011, and has since been profitable.
“We are just focused on building a sustainable, viable, and profitable business for the long term, rather than scaling up in unprofitable ways,” he adds.
The three mistakes
Speaking about the three mistakes of his life that Beerud would advise his children to not commit, he says, “Get started on the entrepreneurial journey for the right reasons.” One cannot take the route to simply make money.
“It is a way to track progress but there are lots of other easier and less stressful ways of making money than entrepreneurship because here it takes over your life,” he explains.
Thus, one should start up only if they are extremely passionate and excited about the cause.
Secondly, one would need grit, perseverance, emotional, and mental fortitude to go through the entrepreneurial journey. “The highs are super high and the lows are super low,” he says.
Thirdly, one should not get caught up in the small stuff, so that one has the time to focus on the big stuff.
“Make more mistakes but recover quickly from it,” Beerud says.
Listen to the podcast here.
Edited by Megha Reddy