 Hello and welcome to the eForum Talks Show. Our guest today is Vivek Bhargav, co-founder of ProfitVivik. Vivek is a serial entrepreneur, angel investor, speaker and whatnot. Welcome to the show Vivek. Thank you. Vivek, you come from a family that is into business of musical instruments, sitar. But we learned that you decided to set up your own digital marketing company instead of joining family business. And I think it was in the late 90s when most people had neither heard of internet and neither they know about the digital marketing. So, can you quickly share your experience and learnings from your first venture? Sure. So, there you have a very interesting story how the whole company started. So, Bhargava's music and Bhargava's group basically is into exports of musical instruments. We export really 14 countries. And we have a character role in a family. All the kids are told when they are 13, 14 years of age that if you come and do bank reconciliation, you come and work in the office, you work in the shop, then we'll take you abroad every two months. So, we should have trade fairs in Paris, in Germany and other places. So, we would get to go and attend those trade fairs. And the opportunity for us was that when you're 14 years old, you will need to give your right arm to go to Paris because you can tell your potential girlfriends that I was in Paris yesterday. But the fact of the matter is we were bonded laborers there because what would happen is we would make coffee, we cleaned up the stall, we would do everything and with the cheapest labor they could find and caught up in any ticket. But the exposure that I got, especially in the US market, was the way US and American companies were using technology for marketing was a big lacuna area in the Indian corporate sector. I think companies in India were hesitant to do marketing itself. We come from very humble culture and then using technology for marketing was a bigger lacuna area. So, in 1997, I started Communicate 2. The goal of Communicate 2 was we'll help companies in India leverage technology to make their marketing more effective. With that vision, we started Communicate 2. But what you're saying is right, it was hardly, people didn't know internet. So, the initial years, we were basically taking companies brochures, putting a C-ROM in it, which was made by us. And then you would hand the brochure back to the company and you tell the company, now your digital transformation is complete. You have a C-ROM in your brochure. So, that was the first few years. But we did a C-ROM, we did a C-ROM from Ban. So, we've had tremendous success. The first two ABI awards of digital were ABI goals, who won by us, won for MTV and won for Arts, Science and Social Sciences. So, the early days were very, very exciting. And I think today I appreciate digital a lot more because of the effort that I put in those years of trying to understand digital when digital was zero to one. So, but I think that learning at that point in time for me was very critical because how do you pivot your models, right? When digital marketing didn't work, we pivoted to a C-ROM. When that point in time, website creation was won, but we realized that a lot of people need consulting, we started consulting companies. We were able to build the first MTV website for India. We built the first MTV website. I had done a website for Mucchad Panwala which became very famous in those days. And we got a lot of traction. So, Dan MTV gave us less references and clients, but Mucchad Panwala gave us more references and clients. So, I think when you're in that stage where there is no market, you're trying to create a market, then innovation becomes very critical. And you have to think on your feet and create some kind of, you know, they say that how do you create that purple cow? That because of that, you are able to build a great company. So, Mucchad Panwala was our purple cow. You have been part of Densu Group for a very long time. And when you started off at Profit Viz, and I guess you wanted to connect at Tick with Martick to make them both efficient. So, how successful you have been so far in doing so? Yeah. So, I'll tell you my story with Densu, right? So, I sold to Densu in 2012. Once I sold in 2012, there was this five years on out where they buy your company, modify your period of time and digitally grew, like we almost grew 15X in those days. So, we had a great on out. Then what happened was I spoke to Ashish who was the CEO then, like what are the things I should do next? So, you know, we can build a performance group. So, we acquired a few companies like SVG, Socrating worker, etc. And we were able to build, I think the performance group of Densu was five exercise of most of the groups. We were almost 2000 people by the time I left. And how I left was very interesting. Middle of COVID, July 2020, I was writing a book on happiness, which is now getting published in the next few months. Profit wheel has taken over all my time because of which the book has been delayed. The book is complete. And one line, the book is called happiness is a muscle. I wrote a line in the night that says happiness comes in the growth phase. It does not come in the phase of stagnation. Next morning, I quit Densu. I said, I'm stagnating in Densu. And I wanted to build a company along with two co-founders, Aman Khanna and Gautam Meira, where the whole focus was that this company should allow us to build a SaaS platform for at that point in time, connecting ad technology. But over a period of time, we realized that there is a bigger space for consumer intelligence. So what we've taken to build is a consumer intelligence platform. It is focused on large enterprises. We work with 1,400 companies in U.S. who invest about $25,000 a month with us on the platform. In India also, we work with ICJ Bank, Bajaj Auto and some of the clients who are again paying $20,000 and $25,000 eventually for the platform. But what we do is we are creating a consumer intelligence platform for large enterprises. So most companies know a lot about their customers based on what the customer transacts with them. But if I ask you, would they like a certain cuisine? They like wine or beer? They like a certain sport or not? They like comedy as a genre? All this information is not there. But the field of advertising ecosystem, Google tells you what people are thinking. Meira tells you what people are doing. Amazon tells you what people are buying. Spotify tells you what people are listening. We can tap into the official APIs of all these platforms. You can actually know what your customers are thinking doing and buying. That can make content creation more effective, creative more effective, media buying more effective, influence selection more effective, marketing expansion more effective. It also gives a common currency to large organizations. And this is the psychographics of your most popular customers. How do you align all your teams to work in that same direction? It's basically getting a not start for the organization. So all the teams work in the same direction. That's very, very powerful for individuals. Right now, all the different departments work in silos. They don't know who to go after. So here it's data-led and it's very deterministic data because the platforms tell you consumption, tell you intent, they tell you buying behavior. So it's very deterministic data and I think large organizations can transform themselves when they initiate working with property. Vivek, you talk, you also talk about, you know, making advertising and marketing expense as cost of sales rather than expensive. Can you please explain this proposition? Yeah, see, basically what happens is right, the biggest challenge with the advertising industry is right are all the most of the partners work on a percentage of advertising spends. So the client is spending $100, let's say I'm earning $10. If I make the client spend $1,000, I make $10x, I make $100. The problem is for me to make like $90 more, the client has to spend $900 more. So the thing is at some level, that model is local. So what we thought was that we will give you a consumer intelligence platform, whether you spend 100 crores or you spend 1000 crores, our cost to you is the same. We can give you programmatic from that. We can give you content creations, insights, creative insights. And the goal is that if we can make your advertising as a cost of sale, the problem with advertising is it comes in the profit and loss account, so it's an expense. If we can shift it to the balance sheet, it becomes a cost of sale. So if I tell somebody, listen, you won't need to spend a billion dollars, as long as I give you $10 billion of revenues, they don't have a problem is earning a billion dollars. So I think the way you look at it from a long-term perspective, a lot of advertising is going to become cost of sale based, especially the creator economy and the influencer economy is helping that process. But I think there is a role to be played across, advertising has multiple roles, right? So there's awareness, interest and desire, and there is action. Action has to be cost of sale based, but awareness may not be. So if you really want to help your client and increase the spend 10x, if you can work and eventually help them pay advertising at the cost of sale, they will get a lot of benefit. But what we thought in that process was that instead of working on a percentage advertising spend basis, we will work on a SaaS fee basis. So the SaaS fee allows us to be in the same side of the table as a client. The client saves 50% advertising cost, then they don't pay us 50% less. Otherwise, what happens is my incentive to say that money goes away because of my revenue reduce. So we just charge a flat fee with a tech platform and that has allowed us to work where we are on the same side of the table as a client. We are not the adversary, but if they spend more and that's the only way for me to make money, then at some level, there is a conflict. So are Indian brands open to experiment with SaaS tools? I mean, you have lot to offer. So actually, I'm being pleasantly surprised. We now have clients who have been paying us for each year. We have clients who are paying us $10,000 a month only for pilots. We have clients who very easily will take that $10,000 and making $50,000 a month as SaaS fees. So I think the way I look at companies is, I don't think we should divide companies from India and US. The way I look at it is that about 2000 companies in the world would be willing to invest between $50,000 to $100,000 in SaaS. Now, out of the 2000 companies, 1,000 there are probably in US. The rest of the 1,000 are in the rest of the world. There will be 200 companies in India, 100 companies in India will invest $100,000 a month on SaaS. Now, if you take a Maindra group, it's $70,000 gross. So it's $10,000,000. Globally, there will be 10 other companies worth $10,000,000. They are all similar to each other. So I think what code is done is it has made the world flatter than before. So sitting out of India, my head of products is from the category in Canada. My co-founder is based in Boston. We've got people in different parts of the world working for us. So what happens is we are a global company even though our tech team and a co-founder who's the CEO of the company is based out of Mumbai. The fact of the matter is we are a global company and I should treat every company based on the revenues they have rather than look at what geography they're assigning it. If you take a Bajaj Auto, they have operation in 70 countries. So the fact of the matter is sitting out of Pune, they're able to operate a company which is in 70 countries. If we license our platform to them, we can help them expand in 70 countries. So then for them to invest $20,000, $100,000 a month, it becomes much easier because they're adding the millions of dollars of value. So if you are able to deliver a million dollar value to a company in any part of the world, whether it's India or US, they will pay you $100,000 a month. Are these tools affordable for SMBs as well? So what our goal is, right? I think at this point in time, what is our cost? Our cost is the sales pitch that we have to make to them. Our cost is the consulting we have to give them. We do workshops with the senior most companies like C-Suite or these large companies. So the conversation we have with them is very strategic. So in a way, we're playing the role of McKenzie, kind of a consultant who's helping them navigate consumer insight and consumer intelligence to take decisions across every single fast-forwarding organization. So at this point in time, we can only help large companies who are willing to invest $10,000 and above per month on SaaS fees. But you fast forward a few years, right? I would like to give our platform for $99 a month and give it to millions of people. But then at that point in time, it should be self-serve platform. The customer success has to be self-serve. There should be a credit card mechanism. You should see the videos and learn how to use the platform. You should figure out how you can use your customer data for all the decision-making. The large enterprises need somebody who will help and handhold them. And it requires people of my caliber to handhold them. And I'm an expensive guy, right? That's the reason the tool takes more effort and more time and it's expensive too. But eventually, SaaS has 90% gross margin. So fact of the matter is that eventually, can I give it $99 to a million people? That will be $99 million a month. Yes, I would love to do so. But we'll do so after we get the first 500 clients. So we go to about a $5 million ARR, then we will give it to SMEs thereafter. So we would like to know about your tools like Audience Comparison, Market Finder, and Market Expander. I think they look like your company, right? Yeah. So what has happened now is we've taken all our tools and we put them into one single omnibus. It actually looks like a Google search engine. So maybe I can share the screen and just show you how the tool looks. Yes. So this is our platform. It's called consumer.ai. This is exactly the platform that companies get. So whatever you want to do, whether it's Market Expander, whether it's Interest Finder, et cetera, you can do it out here. So like we were talking about Mahindra Auto, right? I can just put in Mahindra Auto. As here, I can take Mahindra. I can put Scorpio out here and within seconds, I can tell you which globally markets there is maximum consumption of Scorpio outside of India. So click on this, it'll create a global map of the world and tell you which countries in the world are consuming more information on Mahindra's Scorpio. So and at this period it works, right? So while we're talking within 30 seconds, it has already created a global map of where consumption of Scorpio is happening globally. This is the period it works. This is all happening live, right? So India is the largest. After that is South Africa. Now South Africa, we want to sell Mahindra's Scorpio. I want to know the psychographics of people who consume information on Mahindra's Scorpio in South Africa. I click on something called View Insights. We built this entire taxonomy. We can tell you the Asian gender. We can tell you the stages of life they come from, what the interests they have and all this is now being built for South Africa. So these are consumers who are consuming information on Mahindra's Scorpio in South Africa. So let's say they are 78 percent male, 21 percent female. In Mahindra's Scorpio in India is 9 percent female. That means there are more SUV drivers in South Africa who are female as compared to India. So now that may elicit some kind of product changes that you do for South African market because there are more female drivers in it. And India is mainly male drivers. Now you look at their interest, right? Their interest in outdoors, interest in fishing, surfing, camping. So now just imagine, right? You may need an accessory where you can put a surfboard. You need an accessory with a fishing rod. So when you're launching an SUV, a Mahindra's Scorpio in South Africa, you need to cover a place for a fishing rod and a surfboard because they have very high interest in fishing and surfing. Interest in automotive, the interest in obviously in boats because it suffers. They also need a 4x4 which is a Mahindra's Scorpio. Interest in sports, in sports they are interested in car racing and golf. Cricket is there, it's a niche market. But they're interested in golf and car racing. So now this imagine, right? This will drive. You started off with just one topic which is Mahindra's Scorpio. You've got global consumption of demand of that one car. Then you've got psychographics of the audience in each country. Based on this, you can do product planning, you can do marketing, you can do content creation. So let's say if you want to build a community of people in South Africa who will be perfect target audience for Mahindra's Scorpio, then you should build a community that focuses on people who are car racing enthusiasts or people who are fishing enthusiasts or people who are surfing enthusiasts. And that community is your best audience in South Africa. Now that community may not be your best audience in India. So imagine, right? Instead of doing market research, they spend close to rupees in their content planning, their creative strategy, their entire media buying, everything. The global expansion, right? Suppose you are in 11 countries, just with this one search, you can decide these are 11 countries. What is the 12th country I should launch in? So based on the consumption of your brand or your industry, you can decide which country you want to next. Because just imagine launching in a wrong country can be so expensive. You need to choose your brand ambassadors based on this. So if you have a brand ambassador who's a surf surfing world champion from South Africa, he can be a great brand ambassador for the Scorpio because your audience loves surfing. So the way we look at it, they say, intelligence engine is like Google. You can do millions of things on it. Click our button should we do it. So we've taken all our tools, put it into one single bar, we call it an omnivar. So anybody who knows how to use Google and start using a tool within 10 minutes, because all you do is go to that search box and search for whatever you want. Imagine for you, right? And as a journalist, any topic that you want to research, right? If you had this tool, why would exchange from media and not give this tool on a per user basis to every single journalist you have? Because suddenly what happens is even the creatives, right? We can actually create blogs based on psychographics of your customers. So our tool integrates into chat GPT, it is in a co-head, there's a bar, then we have a comparison AI engine. Based on that, we are able to create a creative brief based on your customer data. So we are 100,000 customers with water minus copy. Now I'm going to create a creative brief and a creative unit based on the psychographics of those 100,000 people. So that is the power of AI in a way in the world today. And platforms like us, we believe we can transform companies. We are so excited about working with some of the large organizations because I think we can transform them at every single level of the enterprise because once they know these are the most popular customers they have, everything the organization does across the organization can be aligned in that one direction that not star and that can be really transformative for the last time. I guess data security and privacy is also a major issue now with more and more companies investing in first party data these days. Do you see a spike in demand for security tools? Yeah. So we are a consuming digital platform dungeon. So we may not have a play in the security part of it, but only what we've done, right? We believe that there are two things that happen. One is cookies are getting deprecated. So cookies are going away. The second thing is GDP and CCP has become very important in the world. So earlier people were thinking of consuming detergents on a one-to-one basis. So they were not thinking, what does the country like? Does she like wine or beer? Does she like a Korean cuisine? Does she like outdoor? Should we like campaign surfing? The problem is even that data, if I have about you, I can't activate it anymore because the thing is no advertising platform allows one-to-one target. So what we've done is we have done enrichment at a cohort level. So the way we work with clients is large enterprises upload the data into any of the platforms. The platforms take that hash data, delete all the data and just link it to Facebook IDs. And we take that data and work the magic of our platform. So because of that, we are GDPR compliant, we are CCP compliant. And at no point in time, we are touching first-party, even hash data of any of our clients. That allows us to work with fortunate companies quickly without spending two years of contractual negotiations with them because if we're handing the first-party data of a large fortunate company in US, then it would take us two years to start working with them. We're able to go live with them in two months. So I think security is going to be critical. A lot of companies who are based on collecting consumer intelligence on cookies are going to face challenges. Companies like us who basically focus on first-party data because what we're doing is we're taking a genome of your most popular customers and then allowing you to see what the genome looks like and based on that, telling your organization to take every single facet of the organization targeting that genome. So and because it's done on a cohort or segment basis and you're not sharing any first-party data with us, it remains extremely secure and that allows large organizations the comfort to work with in a way a company like ours, which may not be of a similar size because at least at all points of time, security and safety of their first-party data is paramount in their minds. Yeah, now the last question. We would like to know from you, what are the emerging trends in SAS? I think the emerging trends in SAS, I would say EI is the biggest emerging trend in SAS because I think Ben Evans says that there are certain things that reset the entire world. I think generative AI is resetting the entire world. So what's happening is that everything that we do is improving. So in fact, our platform uses a lot of AI, a new network that we build because we have mapped 1.2 million liters of Facebook to 200,000 categories on YouTube, 220,000 categories on problematic to 70,000 on TikTok and 600 on Snap. We build a new network that takes an interest in the market expansion you mentioned. Audience that likes ticket to India, likes Formula 1 in Dubai, likes ice hockey and like soccer in the UK. So just imagine that mapping done at the global scale cannot be done without AI. And now what we're doing is we're taking all these inputs and putting into a cohort, bar, data GPT, et cetera, and then using a comparison AI engine to give you the output. So the way I look at it is when you see the video script created by a platform or a search at a platform, it almost makes a creative agency squam because they think they're going to lose their jobs because the AI is generating this by superior quality at the speed, which is unbelievable. Really what my thought on this is, let's say 50 years ago or 25, 30 years ago, Tom and Jerry Carton was made by a thousand people. But what happened was that today two people with a computer can actually create Tom and Jerry Carton. But you know what, today we don't make Tom and Jerry Carton anymore. We make Shrek. Shrek still requires a thousand people. So if you want to continue doing what you're doing today and after 10, 20 years, you still want to make Tom and Jerry, you will not remain relevant if you go bankrupt. But if you're ordered to make Shrek, you, if first of all 30 years ago, Shrek was just not possible. So you have to now still take a thousand people and build a Shrek. So in the marketing and advertising parlance, you have to do a lot more than you've done ever before. If you have 100 million customers, can you divide those 100 million customers into 100,000 thousand cohorts? Can you have customized creative for all those thousand cohorts? Can you have video script for all those thousand cohorts? Can you do something phenomenal for all those thousand people, thousand cohorts that are different from each other? That cannot be done without AI. That cannot be done without platforms like ours. But if you still want to do the same one creative for 100 million customers, then you're going to fail as a company because you're not going to be relevant. Somebody else will create those customized creatives for your 100 million customers in a thousand cohorts and they will get much better efficiencies than you can ever imagine. So I think generative AI is the biggest trend in the field of SaaS. And I think it's going to transform every single SaaS company because Salesforce is integrating with JGPD and AI. Searching is integrating with it. You have Slack, which is now integrating with it. So luckily we were built from day one with AI integrations. So we do have a competitive edge over companies who are now trying to integrate AI into the SaaS platforms. But that's the benefit of starting a little late than other SaaS companies because then you are able to take the latest things and make it a part of your DNA home scratch. Thank you so much, Vivek, for taking time out and speaking with us when you are in the way. Thank you. My pleasure. Pleasure speaking to you. Yeah, thank you.