 As we first start with introducing Abhiraaj, I met him 2 years back when we visited him In 5 years of operation, we see the company almost at the stage of his unicorn So a big clap for Abhiraaj Baal And Abhiraaj, thank you so much for taking our time My pleasure, thank you so much for having me, it's an absolute honour And as I mentioned, I have a very special place for entrepreneur in my heart So I can never say no to you guys, so thanks a lot for having me Thank you So Abhiraaj, as we all know, every Pranthi startup story starts at an IIT And you also went to an IIT Kanpur and that's where the entire thing started So at that time, were you thinking about starting as an entrepreneur? Was there at the back of your mind? No, I don't think so So I think in IIT, you were very looking to get through the courses without failing And somehow graduate with some respect And you know, you're surrounded by such immensely smart and intelligent people So throughout my school, I was an entrepreneur I found myself in IIT Kanpur And I was, I guess for the longest time, struck you even the class average That was a very humbling experience In fact, I'm pretty sure a lot of my batchmates look at me and say You know, if he can do it, then so can we You know, so I graduated bang in the middle of the class, class average And I also graduated in the recession of 2008-2009 Which was perhaps after the 1929 Great Depression One of the worst financial crises that the world could see So we were, you know, to be honest, just worried about how we can find a job Because it was a tough market to graduate And also it wasn't like I was a 9-pointer or a 10-pointer I was in the middle of the class So I never thought of entrepreneurship or any such thing And I said, as long as I can graduate with some respect and a job, that's good enough So when to BCG, this interesting mix that brings out the entrepreneurship in BCG I went to after I graduated from IIM and Lahman Where I did my MBA You know, BCG was a great time for me I spent three years across India and Singapore As a young 24-year-old management consulting has the opportunity to put you into boardrooms And expose you to CXOs and CEOs So it's a phenomenal, I would say, learning ground for understanding how business is done But at the same time, somewhere, you know, I felt that it would be great If I could be in the thick of things It's almost, as a consultant, you often feel like the guy who's standing at the edge of the ring in a boxing match And as much as you stand at the edge of the ring in a boxing match Unless you jump into the ring and take a few punches, you can't learn how to box So that analogy I think is true for business as well You can consult all you want from the sidelines But unless you jump in and try to build something of your own You will never have that real experience of what it takes to build a business All the difficult sleepless nights that one has to go through And the fighting in the trenches Many people in the audience who are, you know, entrepreneurs Have built their own business can relate to it It is not all hunky-dory It's tough times, it's time when you have to battle it out And I think somewhere I knew even at BCG that that was the kind of experience that I wanted So I had a lot of fun at BCG But two, three years later I realized that it was time to move on A great time in all these years And, I mean, after that you also started another venture Before, yes, you succeeded in Urban Clap Would you like to talk about your... Yes, so actually very few people know that before Urban Clap We had one company called Cinema Box Which failed and why God did it fail badly You know, when I started Cinema... I won't even get into the details of the idea But in one line if I was to tell you what we were trying to do At Cinema Box we were trying to install a box In a bus, train or plane Which would stream movies and other content onto your smartphones So the idea is best described as on-demand entertainment in long haul travel And I remember coming up with this line And at the time I felt like this was a huge, huge opportunity And the next big thing and so on and so forth So Varun and I, you know, we started this company after leaving BCG I think we started this company with a lot of naive people Everything that BCG had taught us Market study, you know, deeply doing research We did none of that, we kept it all on the side We said, now we are entrepreneurs, we will go with our cut We will go with what we feel is right And this idea was like a light bulb moment that came to us And we said, this is it, this is what we are going to do Long story short, it took us a few months And you know, lot of money, personal money that went wasted To realize that this business was never going to be a viable, large business That we had imagined that we would build And it wasn't going to be the next big thing It wasn't going to be deeply impactful for society in large It wasn't going to earn us a lot of money It was basically a bad business And that was a very hard pill to swallow Because, you know, you have all these fancy degrees And you have all this international experience And management consulting, you actually tend to believe that You have the right to succeed And then when you are not seeing that success It's a little bit, it's different It's not very straightforward Also, I think at the time we were meeting a lot of entrepreneurs Who were similar to us, you know, IIDs, IINs And you know, but who were also unsuccessful Some of you were meeting only unsuccessful entrepreneurs In that phase That's the other thing, when you are unsuccessful entrepreneur You only meet unsuccessful, successful ones don't meet you So, when you were meeting these unsuccessful entrepreneurs Who had spent four or five years building their companies And it was very clear to us that they are going nowhere We realized that our success is not a given You know, I mean, we are looking at these people And we said, hey, if we continue with cinema box It's quite possible that four years later we are in their place You know, no business, nothing real and we are still at it So I think that kind of scared us And then a very, I would say, strong dose of objectivity prevailed Where we have the ability to look at our own business Which we were so passionate about with this passion And that I think is very important Because often we get wedded with the ideas that we are executing Or the businesses that we are building And we lose objectivity And I think that objectivity was not just relevant for cinema box It has actually kept us in good stead even at urban clap So we made multiple business model and operating model changes So one day Varun and I got together You know, and a good thing with building a business with your college friend is You can get together over a bottle of old monk and just call it quits So that night I remember, you know, we said this is not working The writing is on the wall, we can spend two more years And then call it quits or we can call it quits today And that night we basically shut the business And the next morning when we woke up, I think, you know, maybe it was youth One of the most amazing things about youth is that you feel that you are bulletproof So that feeling of bulletproof is there We did feel, we felt completely outraged We didn't care about the fact that we had lost a few lads Or that time had gone or the first attempt was a failure So we felt supremely bulletproof and we felt great It got done Now at least we can focus on the next thing which might be successful And then we start to think about what we can do And that's how we got to urban clap We came in for urban clap For urban clap? So this time we were more careful, I think Once we did it twice shy So we did a very classical market study And went and spoke to lot of customers Lot of service professionals I wouldn't even say that urban clap is not even an idea In some sense we are organizing an unorganized sector So it's more of a sector which is unorganized Which has always remained for decades and decades Old services and local services has always been around But it has been an unorganized sector And I think shutting cinema box By that time Raghava joined us who is our third co-founder And he had shut his own company So the three of us had one thing in common That each of us had crashed and burned one company Which is great Then we started on this journey of urban clap We were okay to take a little bit more time We were okay to spend more time in the field Talking to customers, talking to service professionals And really trying to understand what the pain point was In the moment local services market And how can we attack that pain point So I don't think there was a light bulb moment this time It was more of a methodical spending time In the field talking to customers and service professionals And then trying to arrive at a meaningful solution And also there is not any segmental crap And we have seen other process How did you achieve 100 million dollars in 5 years? So I would say one of the things that has worked in our favor Is that we have throughout our journey We started in November 2014 So it's been almost 5 years for us now A few months less than 5 years And throughout our journey we have been very focused on Creating good customer experience And good experience for our service professionals And I'll take a minute to talk about each of these See on the consumer side, what do customers want? They want a high quality service They want it on time And they want it at the right price These were the 3 biggest pain points in our sector You call a service professional, they don't show up on time They will come and they will do a half paid job of the service And then they will quote you whatever price they pay you If you are wearing a Rolex watch and you are in a great house The price will go up to 2X Early on we recognize these 3 core problems Which is quality is important Therefore invest in training Train your service professionals Don't shy away from setting up training centers Today we have more than 15 training centers in the country We have more than 100 full time trainers And we have just day before yesterday's Signed a long ranging EBOU with the Ministry of Skill Development Which focuses on setting up 250 training centers With more than 5000 trainers Who will train 10 lakh service professionals Over the next 5 years So we have been very clear that Yes we are an app-based company Yes we have a technology presence But at the end of the day the problem is in the real world And so you cannot shy away from that problem If there is a dearth of quality and skill professional You have to do training And you have to invest in training That became the first step Similarly on the service professional side If I was to talk about what they are The biggest pain point in life is If you see today The average plumber or the average carpenter Or the average beautician Who is living in the offline world And working in the offline world Is making 10, 12, 15 thousand rupees a month I remember I grew up in Bombay in the 90s Being a beautician was a very respectable profession My father was in the Indian Navy And you had officers You know wives of naval officers Who would take force of beauty For a few months and then set up A small beauty parlor in their house It was a very respectable profession And they were back then making 10,000 Plus 10,000, 15,000 rupees a month In the mid 90s and the late 90s Fast forward to 20 years later The beautician is still making 10,000 And 12,000, 15,000 rupees a month Cost of real estate has gone up Cost of marketing has gone up Cost of products have gone up Consumers are not paying more money So what ends up happening is Some lie item in your P&L for the salon Which is the salary of the beautician Is constantly coming And what happens in 10,000 or 12,000 15,000 rupees a month today If you are living in Delhi or Bombay You cannot even afford You can't even set your kids to the schools So this was a rampant problem In the local services They were good professionals But they did not have access to the market They were underutilized Middle men were eating in the margins And their earnings were 10, 12 Maximum 15, 80,000 rupees In our model we said that the professionals Will become a micro author He or she will work for himself or herself For every 100 rupees in the customer base 80 will go into their business And the more jobs that they do The more money they get Actually if you do the math And if I just take the example of beauty You know on an average consumer Spent 1,000 or 1500 rupees So if 80 percent goes into the pocket Of the beautician And she is even able to serve 2 or 3 customers a day Which is quite possible to do She can make 2 or 3,000 rupees a day Or 60 to 90,000 a month So the potential is massive If the model is sweet And today on the open cloud platform We do have that We do have many, many, many beauticians To make upwards of 70, 80, 90,000 rupees a month Last week I was having breakfast With an AC technician Whose kids study in DBS Archipuram The other day a friend of mine Called me and she said You know I booked a beautician from urban clap And she is asking me where she can park her car And what do I tell her? I said hello where she can park her car I mean these professionals deserve respect They deserve the right to have A meaningful middle class wage And these are skilled professionals So we need to start looking at them differently And what urban clap has done for them Is not just improve their earnings To 30, 40, 50,000 rupees or even more It's also given them the respect, the legitimacy All of those nice things Today they have a bank account They have credit card They have insurance They have a certain legitimacy to what they do And that I think has been a big impact For us on the service partner side And as a result of this sort of Win-win model for consumers and service partners The company is skilled for us As a non-servicenter You are creating a micro-servicenter So when you are building a tech business Of course you are Looking at valuations You are looking at railing funds Because the business costs you a lot of money And you need to pay customers You need to market your business and everything So how as an entrepreneur You keep a track on equity dilution So first of all I think You used a word word Unicorn when you started And then you said unicorn And I think these are Honestly the most French but these are the most Bullshit words and metrics That are doing the rounds today I think And let me tell you why I say that And let me qualify that When you are a publicly listed And a publicly traded company You have a certain valuation The valuation in the public markets Is a consensus amongst A wide range of people That this is what the company is worth If some people believe it's worth lesser They will start selling and someone else will start buying And a very very efficient Marketplace exists for buyers and sellers Which are agreeing that this is what the company is worth In the private markets You need to convince one human being To give you a certain valuation And then that's what you open Now obviously we all know that it's far more difficult To convince a large spectrum of people Compared to one human being But I think as an ecosystem While it's good to celebrate milestones Whether somebody reaches 100 million in valuation Or half a billion or a billion Beyond that one day You know as entrepreneurs you need to forget about it And you need to move on And you also need to be cognizant That someday you can take this company public So you have to defend this valuation In the real world And the real world doesn't care about technology Or how fancy your app is Like that they care about cash flows And they will value your company On free cash flows They may give you some time to grow And if you're especially a fast growing company They may understand that you have some losses But eventually your company Will be valued on free cash flows So we've been very cognizant of that From day one Not to say that we don't invest in growth And we don't burn money We are a loss making company today We are likely to be a loss making company in the future But that's also because we are growing at 200% yearly If I had to Focus on growing at 40 or 50% Which is a very healthy growth rate in my opinion I could have a profitable today So a lot of the growth A lot of the losses are Focused on investing in future growth And maintaining a high growth trajectory At the same time It's a tight road You have to be very very careful And cognizant of how you are spending You have to be very careful and cognizant of Whether you are over spending Or whether you are right spending And whether you are investing Or whether you are burning There is a thin line between investing capital For growth versus burning money And that I think every entrepreneur Makes that trade-off and makes that fine balance It's extremely extremely important Not to get carried away With valuations and funding In fact in some sense We should be celebrating it And one of my angel investors Wrote this recently He said it's important to celebrate Periods in a company's journey When they are not raising capital Because that means that they don't need more capital And they are actually self-sufficient So self-sufficiency needs to be self-sufficient For how much time you remain bootstrapped And when was the time you said That okay now I should look for Outside funding So we were bootstrapped for I think typically lesser time Than most companies are bootstrapped We were bootstrapped for about a year I think most organizations Or most entrepreneurs were bootstrapped For one and a half to two Maybe even longer Number of years before they raised capital In our case We knew that it was a competitive market And that there were lots and lots And lots of competitors Who were jumping in And therefore it was important to raise Outside funding and institutional funding Earlier rather than later Because at some level Capital is an advantage If you have It with you So about a year into our journey We had raised our first Institutional capital capital A lot of people in the audience Might be interested in Going from you When is the right time To reach out to investors What is the value they bring on Would you like to share Some nuggets of freedom on that side My advice And this may not be Completely accurate You have to take it with a pinch of salt My own opinion is that One should not reach out to investors And wait for investors To reach out to you And I will tell you why And what I mean See Everybody wants to look at something That they can't have It's the simple nature of human behavior When you approach an investor The typical view is He's desperate for capital That's why he's writing to me Or she's writing to me Versus if they feel that a company Is unapproachable So you know I can tell you When we had raised zero dollars In capital And investors would write to me And usually the young guys The analysts and the associates Partners will not write to a company That has raised zero dollars So the analysts and the associates will write to me My typical reply to them would be We are not looking At raising capital right now Let's talk a little And suddenly that would I knew that In the internal methodology In the way they work It's required that they escalate They don't want to talk to us And we are XYZ High quality investors Why is this company not interested in talking to us Then they would come and talk to you So my sense is number one Don't reach out to investors Build something meaningful They will reach out to you They will definitely reach out to you That is their job Also don't get carried away If an investor is called you for a meeting Don't get excited about it He's doing his job Wait till you have a term sheet Wait till the capital gets into your bank To be convinced that you actually have capital So that's all the first And what was your second question Regarding this What value do they bring to the table Money 95% of the value they bring to the table A lot of them bring a lot of other value also And they can be amazing thought partners Amazing strategic partners But one should not expect that You should go in with the view That the investor brings Money to the table Anything else that comes with money And as far as money is concerned Make sure that it's a good Respectable, reputable investor After that All dollars are green All rubies are of the same color Doesn't matter, you can take it from anybody Respectable and reputable That money is not We've heard the wrong way As long as it's been on the right way Capital is the most important thing Beyond that an investor will add some strategic value Some thought partnership, but don't expect that Recently urban plans are also Global What are your plans To further expand your business Yes, so we've expanded Dubai and Abu Dhabi Dubai we expanded last year We are likely to launch Singapore as well In the later half of this year I think Our learning has been that The problems That people face Mostly in many parts of the world are similar So everybody all over the world Is looking for Home services Everybody all over the world Is looking for high quality home services At the right price And on time Those three principles that I spoke about Is not just relevant in India It's also relevant in Dubai And we feel it's relevant in Singapore as well Now As long as one is aligned on those principles It's worthwhile to go And enter these markets And try to build a business Keeping those principles Very very clear You cannot directly Explore your Indian model To these countries You have to localize And you have to tweak the model For the local market So you have to be open to tweaking your model But you should not tweak the principles With the cheer building Why Dubai as a person I am actually a believer Of taking bets Which are incremental in nature And not very massive Which may actually In some sense of betting the ship As they say So Dubai for us was a nearby geography Large Indian diaspora If we can't win in Dubai It's unlikely that we'll win in London So that was my thought process Let's first capture the low hanging fruits Establish ourselves Improve our product Improve our service Become a stronger company Before we venture out into larger More global markets And you spoke about how you can become progress I mean what are your thoughts On building a tech enterprise To an IQ level Would you ever want to achieve that? Absolutely I think Once you have taken institutional capital You have to return it back And you have to hopefully return a lot more back Than you have taken Now there are only two ways to return capital back Either you go public Or you sell your company We don't want to sell our company Is a stated objective of our company And we believe That we should be well set up to go public Over the next three to four years So it's not a long term objective that we are chasing It's a relatively medium term objective I think when we go public It is important that we are a profitable entity Because public market investors As I already said Are scrutinizing every company From a very very dispassionate wealth So no amount of storytelling Works with them And above your balance sheet Your income statement And your cash flows So I think we will look to turn Therefore profitable Over the next two to three years Before we go public Thank you for your time