When I started off as an entrepreneur in 1992 after I returned from the US, my father had two pieces of advice for me: never raise debt, and never lose other people’s money. Over the past 28 years as an entrepreneur, I have followed both suggestions.
My first significant venture was IndiaWorld. I started it after a string of failures in the first two-and-a-half years after my return from the US. IndiaWorld was amongst the first few portals globally – launching on March 13, 1995. The focus was to deliver India-centric content to global audiences, using the Internet as a distribution channel. I launched it at a time when the Internet was not even commercially available in India.
The desire to be profitable soon was paramount in my mind. So, even as we published the content, it was not all free – there was a $20 annual subscription fee that stayed for the first two years. It helped cover basic costs. I also started a service to offer website development and hosting for Indian companies. That took time to take off, but it did. At its peak, we were managing 200 corporate websites. And somewhere down the line, advertising kicked in as the portals gained popularity with NRIs (non-resident Indians).
I met with many VCs during that period. In most meetings, I would quote my expected valuation right at the start. Very few meetings went to a second stage! I could do that because we were profitable and I was under no pressure to raise capital. I knew the limitations also – it was hard to attract high-quality talent, which meant our 20-person team was stretched to the limit. We also improvised. Samachar.com was born as a tech alternative to expensive news editors and journalists. Our Khel.com live cricket coverage was done by two office peons whom we taught how to use computers, watch TV and update the scores in real-time.
IndiaWorld was profitable within the first year of its operation, and stayed that way through its eventual sale to Sify for $115 million five years later. It was my first profi-corn.
Tomorrow: Building a Profi-corn (Part 3)