Transcribe
Let's wind the clock forward. You stuck it out through the tough period and then walk us through from there to all the way to going public, right? So that's it. Yeah, so like I said and you know, I think 2000 to 2001 was a fairy tale. Got early stage funding on a business plan literally. Deal signed on a paper napkin truly in Crossroads Mall in Bombay with Neeraj Bhargava of eVentures. Became a good friend after that and but...eVentures decided to pack up and their LPs, which was Soft Bank and News Corp said that listen, we're getting out of all internet businesses in emerging markets and they basically said either shut down or buy us back. And so we did a...This was the meltdown? Yeah. So we did that in 2001 and also 9/11 happened. That really hampered us also saw that travel was hit also. Yeah, so and then two of the other gentlemen from eVentures, Sandeep Singhal who's now at Nexus and Anup Gupta, both of them also became angels in our company and they invested, they believed in us. So I think that was great because they saw I think the not just the passion, but they saw that we are onto something. 2001 to 2005 would tough years, struggle years but great because they tested our mettle. They really, really tested it. Like is it onto something? We focused almost entirely on the non-resident Indian market out of the US at that time. We were in India, but we realized people aren't ready to buy in India and there's a big lesson there. So I really think probably one of the smartest decisions we ever made was to shut down all marketing. Stop all marketing in India. We kept the site going. Rather than investing more trying to make it happen & you know these were days when discounting and all was not par for the course. Like today you say pour in more money, it will happen. No, you never went below a cost etc. , but people weren’t ready to buy online because they didn't trust the medium. So they fundamentally believed they'll do a lot of research online then they will call up their travel agent and say this is the price I'm getting on the internet. Can you match this or can you do better? And travel agents would better it because a) they had a lower cost of operation & b) they saw this new beast kind of eating into their business. But US-India on the other hand, people (the NRIs) based in the US were happy to buy online because they're already used to it and that work and that conversion had already evangelizing, had already been done by Expedia or by Amazon etc in the US. So we looked at numbers. We said India lots of lookers very few bookers. Very poor conversion rate. US, great conversion rate and we'd be silly not to focus on the US. So we said listen, we're just gonna now focus on the US-India market - smaller market (3 million NRIs), but ready to buy and a high-value ticket purchase. That honestly kept our fires burning and kept us alive till 2005. When we noticed that something had changed in India... what had changed in India was a) people had started buying something online and I have to give a lot of credit to IRCTC because IRCTC gave people the confidence that it's safe to buy online, being a government enterprise, there was trust. Also the reality was that the alternative was very painful because the alternative was to line up at a railway station and buy tickets. Again something which young people won't know out there, but it was a really painful experience. You would reach the end of the queue after half an hour or 45 minutes and you realize there were no tickets on the train you wanted. If you sent someone they couldn't call you, there were no mobile phones. So IRCTC got people comfortable that it's safe to buy online and the advent of low-cost carriers gave us a very interesting play with technology. To explain, basically low-cost carriers like Air Deccan who was first off the block, was advertising 99 Rupees, Bangalore-Delhi or 999, Delhi-Bombay and you’re saying “Wow, I want this fare.” You called up your travel agent said I want this and you never got it & the reason you didn't get it a) there were very few seats available on that. Secondly, the travel agent had no incentive to sell a low-cost carrier because he or she didn't make a commission on them. More than not making a commission, they could have charged a little bit of a service fee. If they went ahead and purchased the ticket and you changed your mind, that money was sunk. Because it was instant ticketing, 0 refund, no refund as we all know on low-cost carriers. So that for us presented a very interesting opportunity to build with technology direct connects with all of the low-cost carriers. So when you put in a request Bangalore - Delhi - Bangalore, we open multiple threads at the back end. One with every low-cost carrier. We had already built the direct connect which took time and one with the GDS, which is Amadeus, Saber or Travelport which would bring us all the full-service carrier content and we would fetch all of this in real time. Of course, there'd be a degree of caching and it got better and better so you get you know, lightning fast responses now, but that could only be solved with technology and now if the customer wanted that fare, you put the credit card, if the customer wanted, you know, in-flight entertainment (the good old days of Kingfisher), you paid two thousand rupee more, if the customer wanted to save thousand rupee and take a flight at you know, 1 a.m. in the morning it was there, but you made an informed decision. So fundamentally, what we did was we put the customer in control and that had never happened before. That was the first time ever the customer was in control. It was a heady feeling because even when you went to your travel agent and you sat with him or her and you said this booking they were on a cryptic screen, that green and black screen. You didn't know what was happening. So they could say this is not available, but it is available. So I think that shifted and changed the paradigm forever and really was a game changer and people loved it. It was well received. So 2005, we really ,really hit the ground I think running and really took off... from you know, a small profit focused company in the US, to a fast growing company in India. To give you an idea, we were when we launched in India, we were about 30 million in revenues and 2010, we raced ahead when we IPO’d, we were... sorry 30 million in gross booking. We were about 500 to 600 million gross booking. So we grew 20x in those five years and profitable again. We had three quarters of profitability when we went for IPO, we stayed profitable for a couple of years till Kingfisher went bust then we realized we were too exposed to the air model. We very consciously built in a hotel product and a holidays product and today if you look at us we are now, only 34% of our revenues come from air and more than 50% of our revenues come from the accommodation product and very consciously, we've built that so yeah, it's been quite a journey. Wow, post IPO, there's been MNA. I already mentioned GoIbibo and Red Bus, but there's also been a significant number of investments in travel technology companies like in Ixigo, like a Holiday IQ, like in Inspirock, like a Spitzem hotel and wherever we find these companies are really good on travel technology and are bringing something else to the table, which we don't have ,we are quite happy to go ahead and make an investment there. Got it. Wow, that's a long journey.