Serving SaaS tools to restaurants | Posist
Serving SaaS tools to restaurants | Posist
How did a restaurant owner transform his challenges into a global SaaS success story? Ashish Tulsian spills the beans on his journey from eateries to innovative software!
While managing a thriving bootstrapped tech business, Ashish ventured into the restaurant industry, purely out of passion. But he soon realized that running a restaurant is incredibly operations heavy, and making it profitable is even harder.
Not one to give up, he leveraged his tech expertise and engineered software tools for streamlining management. Fast forward a decade, and those tools have evolved into Posist – a premier restaurant SaaS solution!
Posist defies the odds – global reach and profitability in one package!
In this episode, Ashish shares what it takes to build a successful global SaaS business.
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Additional readings:-
1.For NewGen restaurateurs, technology is a natural starting point: Ashish Tulsian
2.POSist Expands its Cloud-Based Restaurant Platform for F&B Industry
3.POSist Takes Marketplace Route To Boost Foodtech Adoption, Digitise Restaurants
5.POSist Bridges Technology Gap In The Restaurant Industry, Introduces An Integrated Marketplace
Read the text version of the episode below:-
Ashish: Hey all, I'm Ashish Tulsian. I'm the founder and CEO at Posist and I'm really excited for my podcast production.
I wanted to do business as far as I can remember. I probably wanted to do a business in 5th Standard. And I genuinely attempted to start my first startup when I was in 9th Standard. This is the era of 99-2000.
There used to be this first magazine in India called Chip. This magazine used to come with a CD.
Akshay: A lot of such magazines, which would've a CD which would've Shareware software.
Ashish: There was PC Quest, Data Quest, Computers@Home, Chip and then eventually it became Digit. I knew all these magazines. I remember April 98 was the first issue of Chip, and I bought that 100-rupee magazine back in 1998. 100 rupees was technically too much for a magazine.
And I got hands on computers early as well. My dad bought me computer back in 93. And that was like a blessing of a different kind. But I remember, all those magazines had a big impact on me. So from 98 to up till 2006, these 8 years, I used to read five or six computer and tech magazines, and I used to read them front to back.
I used to absorb everything like a sponge. One of the things that happened is that in 99-2000, Chip used to be full of these advertisements of web development companies, web hosting companies and whatnot. And I was fascinated and I was like," Alright, I'm going to kill yahoo.com". So I built a legit business plan. I was in Delhi, Gurgaon was getting a lot of these new age Ivy League grads, were their new sales people.
I remember summer of 2000, I called one of these companies and I said, "Hey, I want to make a portal". And the guy on the other side was like, "What?" I said, "I want to make a portal". He said you mean you want to make a website? I said, "no, I want to make a portal. I want to make a dynamic stuff not a lousy static website.
The guy was ecstatic. He felt, 'Whoa', like this probably is the most qualified lead he has got. And he sent this guy to my home in scorching heat of May in Delhi. And this guy came and I opened the door and he came in and he kept on looking here and there.
And this guy then after having water kept on looking at, then he is like, Mr.Tulsian I said, "yes". He said, "No, I mean Mr.Ashish Tulsian." I said, "yeah, that's me". And I saw his jaw dropping. I saw him getting disappointed with life. And in that moment, I was like, "what have I done?" This guy is not going to speak to me with a lot of confidence.
So what I did is I said, "but wait, my dad is also going to join the meeting". So you just sit down. And I come back, my dad was taking an afternoon nap and I went in and I woke him and I said, "get ready, come out". And he said, "but for what?". I said, there is a guy you need to sit with me in the meeting.
He said, "what will I do there?" I said, "don't do anything". Whatever I'm saying, just say yes to it. So my dad actually sat down in that meeting. And it took like a good 15, 20 minutes of conversation where I was the one who was speaking and this guy was continuously looking at my dad and replying and it took 15, 20 minutes for me to win over him.
That okay, I'm not stupid. And he started looking at me. So I did that. I bought some web space; I bought some domain name. In those days, Network Solutions was the only domain name registrar, so used to send money from here. Did all of that. In 10th standard then my dad after investing this money on me.
And it was quite mean money. At times I feel guilty of making him spent 32,000 rupees then. Because I remember I bought webspace for 16,000 rupees, 16 MB webspace. And I bought a domain for 8,000 rupees per year. And because I wanted a larger commitment, I booked it for two years.
And that domain name was youthhungama.com. So then my dad convinced me and after that he said, "See, I spent money for you. You have this web space for next two years. You can do whatever you want. You make your projects, try, do whatever. You have to commit one thing. Now that I'm on your side.
You have to crack your 10th well". So he convinced me. I was also kind of disarmed now. He spent 32,000 for me. I'm like, I can't speak now. I basically got sucked into that 10th completed. You get stuck into this IIT, JEE prep, 11th and 12th. I think from that 10th class I found myself straight into first year of college.
In between it was a blur. So as soon as that happened, I started my first startup in second year itself and the day I started that I actually told my dad exactly the same thing. I said," you know what? I'm exactly now doing what I wanted to do five years back". And he was like, alright you're free now I'm not going to ask you to even complete your engineering. Do whatever you want.
I think something inside me was definitely there, that I want to start my own business. I don't know where it came from. But yeah, it was definitely there.
Akshay: Youth Hungama is what? Community portal or what?
Ashish: Never happened. So basically, I used that domain in webspace to learn a lot of web technologies. I kept on hosting pages on that. I learned how to develop websites. I think that remained a very experimental domain for me for a couple of years. It never got built.
Akshay: So then what did you actually do as business. By the time you were finishing your engineering, you would've thought of earning money.
Ashish: No. As I said my zeal to start a business was like, I was just waiting for the escape velocity as soon as I'm off my parents' clause or whatever, the societal clause. And that was college for me. So first year I of course raised around in college. Did all the quote, unquote college life.
I did my engineering between 2003 and 07. And that's what I was saying, 10th class was 2000. So I just chilled around. I literally lived and spent like college life. I was not interested in doing anything else. But then by the end of 2nd semester, which is the end of first year, I got really bored and I was like next 3 years in engineering are going to be copy paste of year 1.
This is going to be super boring and I'm not interested in this. This I can do anywhere on site. Like we can chill out with friends. So in second year I started toying with the ideas and I started wondering, "what is it that I can do?" And this is 2004. These are not the days of startups.
I think if you had to find your icons, there were a lot of them, but they were not popular. So Sanjeev Bikhchandani of Naukri, was a big one. Alok Mittal of JobsAhead.com was there, Vishal Gondal of India games. These were the few icons. Deep of MakeMyTrip and so on. So these were the dotcom guys.
They were the guys who basically crossed over the dotcom bus. And as a 9th and 10th grader, my curiosity made me read so much about these things that honestly, when I started my tech company and I met all these people and now I know all of them.
But when I met them for the first time, I actually could tell them by date or by months, by years, what did they do when, and I remember I was talking to Dinesh Agarwal of Indiamart.com and while talking something and he said, "oh, by the way in IndiaMart, back in the day we did that". I said, "yeah, I remember October of 99". And he was like how old are you? He said, "how do you know this?" I said, "yeah, feels like a long time, but honestly I lived your journey so much through news those days that it almost feels like that I lived it.
So I started toying with the ideas and I think because those days were not the cool startup days or startup days at all. My idea in those days was that I wanted to earn money. I wanted to figure out if I can build something that somebody can pay something for. And, logic was very clear that if I can charge you $2, I'll figure out how to make 2,000 or 2 million.
But let me first validate if my skills are marketable, if my production can see some commercial value. So we started building websites. I took in a friend of mine. We started building small software.
Akshay: How did you get business? Did you also advertise in magazines?
Ashish: No. I think this was very word of mouth sort of thing. For example, I remember the first hustle and as a student, what ideas we will get? Library management system, school, website. I remember my first hustle was school's website back in 2004. And wherein, I said, "alright, I'm going to approach my own school".
And I was a good academic student and not that I was thriving for it. And I say this very, very humbly, but I was one of those guys who was scoring well while not bothering about it. So I was good for teachers. My principal knew me, I said, alright, I have access to my school and I have access to my principal. I'm sure I'm going to get business there. So I remember our first hustle was that we built a prototype of a full portal for school attendance and parents can see it. So we went in and pitched and of course didn't get any business. Because I was also clear that I'm not going to give it for free and I'm only going to give it to somebody who pays me money.
And I think our first break was, I think a friend's, friend's cousin. He said, "oh, I need a software for C&F; carry forwarding agent. So they used to be in rice business and he gave us a requirement of a very simple, small software. And I said, "alright, we can make it". And I think I quoted some 15,000 rupees.
This guy gave me a check of 5,000 Rupees advance and I was like, "dude, we're in the game". And we coded that over the month. We delivered the first cut version to him. That month he gave us another 10,000 rupees. And we were super happy, like we were on cloud nine.
Because for me that 15,000 meant road to 15 lakh or 15 crores. I was not really thinking of 15,000 or 50,000. And then of course we started getting little projects. We built a website for someone and then we started going word of mouth. But then interestingly what also happened is that this guy called us 6 months from then and he said, "Hey, can you install the same software's copy for my Chacha.
So we said sure we can do that. And we did that and we charged another 15k and that was my first understanding of difference between services and product. I was like, boss ye karna hai. Product kary gy. We're not going to continue digging these wells every day. We're going to make sure that we make it once and it compounds.
So that stayed with me. That second 15,000 and 3rd 15,000 were really sweet. Then we did a couple of different things and then we kept on getting different projects.
Akshay: You would've hired the developers and all. Built a team.
Ashish: Within first year of this, which was my second year of college, we hired, 3 people.
We took a small office space. Again, this is not the era of co-working and all of that. So people come work and thankfully this is also not an era which boggles my mind when I look back. This is not an era where people will appreciate students doing business, where startup is an absolute no go. Where engineers are not available technically.
And the best you can get is BCA, MCA people or maybe diploma holders from Aptech or NIIT, and they also want to work for a company. They don't want to work for an individual leave alone student. So I can tell you that these are the days when in 2004, when we opened our first office, very small office, but in a commercial centre.
I used to always envy people in Mumbai and Bangalore. Because these are the two places where you can open offices in a residential space and you're ok with that. Delhi is not like that; in Delhi you have to have an office space. So we took a small 300 sq. ft office in a commercial space. I remember the first developer that we hired, he was six years elder to us.
And the only saving grace was that he did not know that we are in college. And we made sure that nobody knew that we are in college. In fact, I think till the time we completed college we made sure that we don't leak this information. So funnily I hired this one very, very senior guy later in the story in Chennai.
And that guy in those days was a project manager at Infosys. So he was 10 years experienced already.
We worked with him. He worked with us for a year and then he moved on. We moved on from that project. Six or four years from then, one day on social media, on Facebook, I think back in 2011. He pinged me and he said," Ashish, I just looked you up. You were in collage in 2007. I said, "yes". He said, "how is that possible?" I said, "why is in not possible". He said, "I worked for you in 2006". I said, " yes."
So he said, "you lied to me?" I said, "no, you never asked that question."
So, thanks social media was not this popular. But I think today things have changed in a very interesting way where startups have become so cool that a student running a startup, people will flock and work for them.
But in those days, we never told anyone that we are still in collage. We shaped in 3rd year which is 2005, is when stumbled upon opportunity of valuated service. SMS based services, valuated services in India was still picking up. And we were not even sure if it was called that then
We were basically just trying to build SMS based services and this was the product idea that we stumbled upon while doing services. Because while doing services, there was a point where somebody kept on asking us, "oh, can you automate the SMS?" Can the SMS go? And then we said, alright, how will the SMS go without a SIM card?
We started a telecom company. We stopped our services business in third year and that was 2005. We started a telecom value added services company. It was called TechnoApex
I came out college while running that company in 2007. I ended up hiring three of my batchmates, into that company.
Akshay: Was it helping businesses with sending promotional and transactional messages?
Ashish: So not promotional. We were doing enterprise business. We were doing transaction based SMSs for a lot of banking clients, for mutual fund clients, for insurance complaints. So we worked with MetLife insurance, Birla life insurance, SBI mutual fund. We did some part of the volume of ICICI Bank.
Then we got into this promotional business with Telcos itself. Every telecom company had these promotional campaigns of ringtone, caller tune, wallpaper. So they used to tie up with others and then Telco used to give their own subscribers database and used to give their own bandwidth.
Our game was that we built the SMS gateway. We built the gateway software, which was deployed on an SMS switching centre. So terminology wise it's basically that. And when Telcos used to do these promotions, they used to pay you on the conversion of it. That was a pretty big business. So we did all of that.
Akshay: This was like a primitive programmatic advertising business or Telcos paying you on conversion.
Ashish: I would not even say that yet. It was not that intelligent, honestly. It was very rudimentary. For us, the way we used to look at our business was very simple. We used to own the gateway.
Gateway was required to schedule and make these SMSs happen because Telco used to only limit their services to anything that runs. Because that was Telco's primary business services. They never wanted to get that SMS providers. Our understanding was simple, that we used to get a bandwidth from Telcos. That bandwidth comes in transactions per second.
For example, I can take a 10 PPS pipe from Airtel. It means that I have a pipe which will throw 10 SMSs per second. Now you multiply it with time and basis, how much can you load that pipe. You have business and they used to charge us let's say 10 lakh rupees per pipe, per month. So it'll come down to 2 paisa per estimate let's say assuming.
So it was a business where, how much can you sell and how much can you use that pipe? Because in telecom company, if you think about it, their inventory is airtime. So the time that you are not using your phone, that inventory is getting lost forever. The time is not going to come back. That is exactly why on festive days towers get jammed because of the airtime, actually each tower works on like a 90% or 10x loading.
So if a tower can handle, let's say, 100 connections parallel, it'll be distributed to a 1000 people.
Akshay: SMS pricing goes up for new year.
Ashish: It's exactly for the same reason. Lot of people think that, pricing goes up because telco wants to earn money. That also true.
But the bigger factor is that if they're not going to increase SMSs price back in the day, you will start sending so many SMSs that their network is going to jam, so they're going to lose the revenue because of the jamming. So they used to increase the price.
So, yeah, that was our business. We ran that business from 2005-11.
Akshay: How much were you earning at the peak?
Ashish: This company made a top line of 8 and a half crore at the peak. And I think we peaked around 2009. 2009 ky baad our business grew, but our top line fell because SMS prices dropped.
So country went through this SMS spam. Imagine in January of 2009, I used to sell this message for 35 Paisa. In October of 2009, I was selling this message for 3 paisa. But thankfully my volume also grew 20x. That's where we peaked.
Our revenue also peaked. I did a lot SMS spam/ promotional campaigns for political parties in 2009. So last to last Lok Sabha elections. I did 80 crore messages for BJP, that was L.K.Advani's campaign. It was his ambition to be the prime Minister.
Andhra had this minister called Y.S.Reddy, he unfortunately passed away in an air crash. So for YSR, I did a campaign in 2009. I think we were the guys who spammed every living soul in Andhra Pradesh, right from campaigning to saying thank you after winning, we didn't leave them right. So we spammed everyone.
And this was a data given by Telco. So technically we were absolutely in the legal. But funny thing what happened is or unfunny in those days; as soon as government came in, in 2010 they were the ones who said, "oh, by the way, there is too much spam in this sector". I was like; dude, are you kidding?
You are the guys who made this happen? So one of the reasons we sold off the company, exited in 2011. It was not because of any other reason, but because between 2009 and 11, I could clearly see that this is not going anywhere. So at the peak, just to answer your question, I think we were doing 8 and a half crore top line, but we were doing 1 and a half crore profit.
So I think as a 23–24-year-old, my take home was pretty high. And I also kind of got disenchanted, with that money because it's not that I said 'oh money is nothing and we should not earn money'. I figured that, 1 and a half crore rupees a year is not going to change your life anyway. And I started feeling lack of scale.
I started feeling stuck. Because all the plans that I had in telecom, they used to get chopped off by some regulation. DND was quite a crap. My biggest thing was that I had global ambitions even then. So my ambition was to run a business that I can run in 96 countries and I want to see the world with that business.
I want to see what happens on the ground. The realization in 2010 was that telecom is one of the most regulated business in every part of world. I was also too naive and I was also learning my experience. So I remember in 2010 when TRAI became active and regulations started hitting us.
I said I want to see which country in the world has a great telecom. And I realized even the most liberal country also has a lot of regulations.
No government in this world is going to let go of communication backbone of the country. So telecom is going to remain regulated. And that was my point where I was not interested in this business anymore and I basically said, well I'm never going to put my hands in a domain where there is a government regulation directly to my business unless I'm powerful enough to write the law.
Which a lot of people in our country and a lot of other countries do. That was a time a lot of consolidation was also happening because DND and TRAI was killing a lot of people and companies were consolidating between 2010 and 11.
Spice telecom in those days was one of our largest Teleco customer and Spice telecom got sold to Idea and somebody from Spice Telecom came out, started doing MNA and we got an exit in between. And again, this was not the TechCrunch exit. We were not looking for 10x revenue.
We were very simple. Somebody was giving us 7x pad and we were like, "alright, please here is the key go help yourself".
Akshay: You had a co-founder here, or you were the sole owner?
Ashish: No, I had a co-founder and that was a friend of mine. In fact he was the CTO and his name is Nikhil Dabas. He basically took an exit in 2011 and he has been chilling since.
Not that we made enough money to chill for life, but this guy was too chilli in his ways. He does a lot of consulting and open-source work. He's sitting in London he never worked again, technically.
Akshay: So what next for you?
Ashish: While this time of disenchantment was going on in 2010, I was also under distracted because this realization was really hard that, "okay, I've built this business and looks like this business is not going anywhere".
It'll continue growing 20, 30% year on year, it was massively profitable. But then your fetish has changed. And as a 22, 23-year-old while you know that 50 lakhs or a crore per year sounds very sweet and it was sweet. But then you outgrow it faster than you believe. And that's the sad part of money.
Money is great but it doesn't really hold you enough for long. I basically started playing with different ideas because I recognized that, we have a tech team and we ourselves, our product people and probably we'll find something new. And I did a lot of random investments.
For example, I put a mineral water plant in Delhi. And we started making those 20-liter mineral water bottles just because we could. It was a good sweet 20-30 lakh investment. And it started happening. Series of these things happened. And one of the things was restaurant.
So I ended up investing in a restaurant also. I think it was very stupid as well. Because it was literally like a 20-year-old with a lot of money and decision making.
We opened restaurant in three months. We opened the door of the restaurant within 45 days of discussing, that okay, this is where restaurant is going to be. Things were happening really fast and we of course were overspending on things which we could have saved money on. Restaurant was one of the projects which happened in between, and it screwed us.
Restaurant was one of the most difficult business. It did not only screw us on money, it basically ended up hurting our egos. Because we were failing and we were not failing at things which we could forgive ourselves for. For example, if we were failing at food, I would've forgiven myself.
We were failing at managing people. Food was great. Because food is a single point of success and failure. You have a good chef. You're in the game. We chose a chef right. We chose the location of the restaurant right. We paid a premium on rent, but we failed on the mat.
We failed on people management. We grossly misunderstood or underrated how difficult it can be to deal with a dishwasher to a tandoor guy, to a chef, or a soup chef or a delivery boy. We grossly misunderstood that.
It's still misunderstood even today. Especially people who are white collar, typing your life away in AC room. You don't know what goes on the ground. Only when you open any sort of business on the ground on the road, that's when you realize for the first time, oh man this is wild.
And these things hurt our ego very, very bad. And I'm calling it ego because within three months of restaurant, actually just to clarify the story, we basically hired a consultant and this consultant did the whole turnkey for us. He said, "don't worry give me your money and I will do the entire magic for you".
And he did that. He did that pretty well. We were involved in the nicer parts of it.
Akshay: Colour scheme and brand name.
Ashish: Brand name, colour, tasting of the menu. We were having a lot of fun and we were like, oh, this is beautiful. This is nice. It's only when first three months ended, honeymoon period ended.
And one thing that, restaurant is actually a reverse business. Every other business that you start in the world, you know that it'll start slow. You will not make any money in month one, month two. It'll slowly grow. That is exactly reverse. You make a lot of money on day one. You make a lot of money in month one, you make lesser in month two, a bit lesser than month three and after four you are fallen.
It's a different problem, because in restaurant space, when your restaurant opens, people buy novelty, people buy curiosity. If you have a decent food, people will come. You can sell the price; you can sell whatever you want. Repeat customer does not happen.
That's when you realize, month three is gone. So month one we made profit. I was like, dude, I'm genius. That of course started going down and issues started erupting. Month three was also the time when this consultant, we caught him stealing, manipulating accounts and because I caught him, flicked him out.
As soon as we flicked him out, everything fell on my shoulders. Right from that bartan dhonay vala team to entire staff, to delivery people to new actors in the play, which I didn't even recognize. Health department, fire department. I was like who are you guys? And why are you bothering me? And I was in a space where I took all the licenses, I invested money in the right commercial space.
So I was also very arrogant about it. Because if a police wala is coming and is like give me free food, I was like who are you? I fought with police; I slammed officials. I did all the wrong things in the book and outside of it. And purely because I was right, because the arrogance of being right, only to learn the hard way that "boss, when you are in the jungle, the rules of the jungle apply".
You can decide to not be in the jungle, but if you are in the jungle, you can't decide what rules you will play by. You better learn the rules or you'll be crushed. So that happened with me. I learned it the hard way. Third month all of this happened with us. And we wrote off this investment, me and my wife. And then the ego came in and then we said, no, man we are smart people. Let's give it one more shot.
Because once we thought that we are writing off the document, it just melted. All the pressure melted and then we said; alright, we are writing it off anyway. Why not give it one more quarter? And this time, let's treat this as our business. Let's not treat it as a side business. The first day we rolled up our sleeves and when we went into the restaurant feeling that, alright, we're going to fix this.
we also said, "where is the technology?" And that's when we said, okay, we are going to fix the tech as well. Because we want a lot of remote control. We cannot sit at the restaurant anyway. We're going to come here every evening for two hours that's all. We started building this product. I pulled out two people from my telecom tech team and I said, guys, this is the MVP.
We need to make it for our restaurant, nothing else. And go back to doing what you're doing. Factly those two people continue with us today. One of them is our CTO at Posist. Basically they never went back practically. We ran that restaurant for 22 months. We fixed that beautifully. In the next three months, we learned how to deal with police and departments as well.
We learned how to deal with staff. The restaurant, we tried to solve the technology, our unit economics. But I think in the hindsight we enjoyed it because once we wrote it off, it became a great experimentation ground for us. We were absolutely fearless because we internalized this, that, okay, we're not going to learn this for long anyway.
Let's learn, let's figure out stuff break things. This restaurant was called Rassoi Express. It was in Shalimar Bagh, north Delhi area. And we ran there for a little over, 22 months to be precise. And, in between we ended up selling the telecom company.
And these are all happening in parallel universes. And we were already 11 months old with the product that we were using at our own restaurant and other restaurant owners took notice because imagine this is 2011. There's no cloud. IPhone is there in the world, but there's no Android.
So technically a regular aam aadmi does not have the understanding of apps and all of that. Non smartphone, non-internet days. And in these days, there are these two youngsters running a restaurant in a traditional market where average age of a restaurant is 50+. These two people are not even coming to the restaurant.
And staff is saying, "oh, these guys watch everything remotely". So we were a subject of envy for all the restaurateur around and the murmurs around was, "oh, these people run some McDonald's sort of technology". So lot of restaurant owners started giving us inquiries and we categorically said no.
Because we were really not interested in selling this product to them. We were like, we're running a telecom company. Sakshi, my wife, she was running a web development services company and both of us were running this restaurant. So we were like, boss too much on the plate, not interested in adding a fourth, tech product.
But then there came a point where the product became really mature and an ice cream chain in Delhi called GIANI IceCream. Think of it like; for people in Bombay it's basically the story of Naturals or in Bangalore Corner House. These guys came to us for help and they said we want your product.
And we were excited. We were like, "wow, GIANI's guy is asking help from us. This is super cool. We grew up eating that. We said yes to them. By that time the product was also quite mature.
As soon as we said yes to him, we started saying yes to other restaurateur as well, who we kept on pushing back for the last couple months. In no time, we had 30-40 stores who were using our product apart from us. In January of 12, we decided to incorporate Posist. We also immediately decided to sell off the restaurant because we did not want conflict.
A restaurant owner selling a restaurant software was not feeling well. Plus we were also done with the restaurant. We had to learn whatever we could from that outlet and we didn't want do the service to it. So we sold that restaurant to somebody else. That guy also ran it for another three years after us.
1st of February 2012 is when we started Posist and we are completing 11 years.
Akshay: Why did you call it Posist?
Ashish: This is a word that I coined. Billing system is generally called a POS.
It's a short for point of sale. So point of sale or POS was a normal industry term that everybody understood. When we were thinking about a name and we started as a POS company. Our primary thing was a restaurant billing software. I find this word how a Dental specialist is called dentist specialist; a POS specialist became Posist.
Akshay: You said that when running the Rassoi Express you wanted to fix problems through technology. The billing was the problem that you fixed through technology.
Ashish: The problems were quite interesting actually. Billing itself was not a problem. Billing is the minimum utility.
Akshay: There would have been lot of solutions for billing off the shelf available.
Ashish: There were a lot of on-prem off the shelf products, which were working actually fine. The journey to solution was, first of all, staff had a lot of incentive in not giving you bill.
Basically breaking down that machine, breaking down that system. Do you see those play cards.
Akshay: If you don't get a bill, it's free.
Ashish: Imagine the gravity of that statement. A brand like PVR or McDonald or Subway is putting that card and actually saying that my employee, my teammate is not trustworthy. As a customer can you please be vigilant on my behalf? Imagine if you are a cashier or you are a restaurant manager, would you like to hand that sort of card? But that in the restaurant space is so normalized that brand also believes that they need to put that card and the employee is also like, "yeah, I understand that".
One problem was that we wanted to fix; that nobody's going to get food without entering it into a system. So we wanted to make sure that happens. Those kinds of solutions were not available. We also were born on cloud.
Akshay: You're saying that order taking itself should be captured, like people should be writing order in a notebook?
Ashish: So not only that. What I figured is that cashier is running the game. Cashier has a lot of incentive in, let's say not billing one daal makhni for 200 bucks. And pocketing those 200 bucks. So I said, "okay, if there are multiple touch points across the restaurant, and restaurant has 22 people working. If multiple touch points, you will get a part of it. These 200 bucks divided across 22 people is not incentive enough. Can you make sure that there are so many touch points, that there is no single point of failure. If this guy has tove money, he needs to collude with all 22, which never happens in the world. That was the starting idea. Second thing is that we wanted to make an unbreakable system. And by that, the logic was that with our POS machine, with our touchscreen system, we also placed a standby laptop on the side where we said, "if machine has a problem, start this laptop".
And this product Posist: which what it is today, was always born on cloud. It was a browser born product. We built a product on browser because we said that in no way this guy should say, "oh, software requires installation again" and somebody has to come and do the servicing.
We were like, "no," for this it has to be online and we are going to pay extra to make sure that there are parallel internet connections. Those days were different. We never installed the product on our system; inventory control system.
It just blows my mind. We're in 2023 today and even today, inventory control is an underrated problem. People recognize it more today, but back in the day it was almost absent. You won't believe what all did we caught.
We actually realized that a lot of pilferage in the food was happening, or a lot of marginal pilferage was happening because of the recipes. But we also figured that how stealing happens, for example, you ordered eight kg paneer. Now you are trying to count how many pieces of paneer will go in one dish. You are trying to count how many paneer dishes you could sell with it.
But the fact is that paneer is 100 rupees a kg. We realized that the supplier is only supplying eight kgs, and the guy who is accepting the order in the morning at 8:00 AM is signing on 10 kgs, and these guys are distributing 2 kgs work of money; one-one each. Now you only have received eight. Your 20% is out. How do you catch it? Again, we figured that there is a variance in the behaviour.
We deployed two different suppliers for each item and we started figuring out the yield from that item by supplier. And as soon as the yield for a supplier dropped, we caught hold of him and we told him that, we're going to complain. Tell us the reality. I actually got supplier who actually told me that, okay, tomorrow I'm going to do something and your guy is going to tell you that there is a complaint in the product. Day after you call him again and he'll give you a good feedback. Let me show you the demo. I said, alright. So we tried to go very, very deep in exactly how theft happened. All of this we were solving through tech and we were able to do it quite well.
Akshay: The product you started selling, just tell me the components in it. One is the point of sale billing.
Ashish: When we started it was billing software. We call it front of the house, point of sale software. And then it was backend inventory control, where you will make your purchases, you'll make your recipe, and it'll deduct inventory basis your front-end sales.
And the third piece was a CRM where you will take a customer's mobile number and all that they're ordering that will remain in the history, the address, et cetera, will remain in the history. And you'll be able to take out the CRM data; slot it basis what the customer likes and how much they spend, et cetera.
And you'll be able to run your marketing SMS campaign. We were there champions anyway, we basically built that in. Our first product in 2012 was these three components, POS, inventory control and CRM. Today that has grown into 14 different modules. Now it is more complex. It starts from table reservation system on the restaurant side, not in the consumer side.
Think of it like all the hosts sitting with the tablet outside, so that kind of thing. From reservation system to inside the store, POS system to tablets or mobile phone that a waiter carries at times to take your order at your table. Then it goes back to KDS system, which is called kitchen display system, which is what; the tickets that go in the kitchen, and like, you can order a burger or fries and a coke and this order will get disintegrated into three different screens, because there is a coke station, fries’ station and a burger station. And then they'll go to an assembler station where all these components will come and assemble it into a single order. And then it will go to a dispatch station where there's going to be a customer screen, which will say order number 69, you'll go and he'll pass it on you and he'll say, ok, this is done.
All the customer display screen, assemble station, dispatcher system, the part of the kitchen management. Then it goes back to the inventory control. And inventory control has a lot of components now. There is in the restaurant site system, and then there is an outside of the restaurant system, which is for example, your procurement, your warehouse as a brand you can have a simple kitchen, where you procure stuff, warehouse them and then cook some intermediate recipes. If you're an Indian restaurant or a Mexican restaurant, you may be making a lot of curries and lot of purees, and they'll be transported to the restaurant. If you're a bakery, you may be making sponges and lot of other stuff.
So you have a central kitchen, base kitchen and then our CRM continues. We don't do marketing piece on it, but we do the full ledge CRM. We also do all kinds of integrations. So today Swiggy, Zomato in India, HungerStation,Talabat in Middle East, in Europe. So we integrate all these aggregators into the product.
When you order, this order lands in the restaurant in fraction of a second because delivery ki game mai 30 seconds can be make or break for a brand. And then we also have a product which powers call centres of some of the large brands even in India when nobody is actually technically calling to place the order, but let's say a brand has hundred stores across India, they want a central control centre, which actually keeps a watch on which outlet is getting order from where and is that order getting accepted on time, delivered on time? They have a control centre. Lot of countries outside of India are still getting calls and a massive number of calls. We basically have cloud call centre product.
In the restaurant space, we have a product for Cloud Kitchen, which is a very specifically cloud kitchen management product. We have a product which works in banqueting and catering. We work with a lot of hotels, but we only do the FNB side for them. We work with a lot of hospitals. Recently, we powered sports stadiums and sports cities. We were powering FIFA Stadium food this time. That was a big one for us.
Akshay: I want to understand this inventory/purchase a little better. If a restaurant buys a software, then do they have to first of all upload all the menu and then for each menu item, do they have to specify that, say, paneer makhni needs 200 grams of paneer and tomato puree.
Ashish: They have to make a full recipe, and the recipe will be really glamoured.
They'll say one portion of paneer makhni is gonna be, let's say 350 grams. Chef will say, I know how to make 10kg paneer makhni, so he'll make the recipe of 10kg peneer makhni.
Our software will portion it, and portion wise there is going to be a one portion recipe. People in the restaurant, they don't necessarily use the same unit of measurement for a certain item in which they buy.
They can buy salt in kgs, but when he is writing the recipe, he will say tablespoon. There can be the other side as well. In India, especially in North India when they buy rice, they'll not say quintal or kg. They will say ek katta rice. Katta is like one word that they're using to define 40kg rice.
What we did is that our product also allows them to create their own units, buy in their own units, and consume in their own units, and it keeps interchanging into the units which needs reporting.
Akshay: My very first job, when I was about 17,18 was at McDonald's. And I was actually a group member. I remember the restaurant closed at 11 and from 11 to 12: one hour, the managers would be sitting on his accounts.
Ashish: All the cardboards, he'll be continuously measuring everything.
Akshay: Tell me about your customer acquisition journey. Initial customer acquisition was organic. How did you scale that?
Ashish: Customer acquisition journey was quite a journey and I think it continues.
I don't think anything has changed, that we have become either a little better or numb to the challenge. The biggest challenge that hit us as soon as we started Posist was this realization that restaurant owner does not have a degree, does not have a qualification, does not come from a certain background.
The problem is that a lawyer went to law school and knows other lawyers. A doctor went to medical school, knows other doctors. Restaurant owner can be a property dealer, can be a lawyer, can be an engineer, can be anyone. And the problem is that basis their background, they'll think about their restaurant differently.
Somebody who is coming from a media background and if he starts a restaurant, he will be high on branding.
While a property dealer will be too big on the location and everything and be mediocre and a chef will be too much fascinated by food and he'll probably think about it differently. We realized: one is the dissonance in the behavior and the temperament of our persona. And we were like, "oh man, what have we done?"
Because now I can't define my persona and have a single messaging for them. I need to tailor it basis who am I talking to. And the second biggest challenge, or rather it was the first challenge in the order was because anybody can be a restaurant owner.
I remember Practo, Shashank is a dear friend. Practo also started two years before us. So we used to chat a lot. And I used to be so envious because, Shashank will tell me, “Oh dude, we signed this dentist and he has seven friends and he has already referred us." And now I'm like, "you know what?
Mine is exactly the worst". Number one: if I have been over a restaurant owner and if I sell it to them. One is they don't know any other restaurant owner. Two: the ones they know are also the restaurant owners operating in their Geography area, so they turned them as competitors. And they don't want to refer us because if our software is working for them, they look at us like a best kept secret.
They don't want owner to know that, this will give you more power. Our customer acquisition journey, started with these challenges like raw, but real challenges. First year we experimented a lot and our experimentation went wild.
We did everything that we could afford or was possible. Right from making a listing on IndiaMart, Trademart.com, buying a package from Justdial, doing of course good old SEO, trying to run paid ads, booking a stall in a trade show finding anything that looks like a restaurant conference or a hospitality conference, knocking the door of all restaurant and hospitality associations, to deploying a team to go door to door.
We did literally everything. And we started qualifying and disqualifying these things. Because one of the biggest issues also was that there were not enough searches for our category. We were actually way ahead of our time and I'm actually grateful to myself and Sakshi and everybody else who stuck around because we can say this today because we survived.
We only realized it in 2016. Honestly, the first realization when I really felt, we were too ahead of our time. But we survived. So that was in 2016, and I'll tell you why.
Akshay: Why were you too ahead of your time? Was it because it was a subscription and nobody used to buy subscription?
Ashish: Not only that, that was of course one of the parts. We were too ahead of our time at a fundamental level. We started in an era where previous generation, our parents' generation was still in power, especially in the restaurant space.
So the average age was very high. Two: internet penetration was genuinely poor, and internet speeds were really bad and internet was not reliable. Three: this is not in era of tablets and smartphones. People are not used to apps. People are not used to DIY. I don't know if many people realize this or not, especially our generation 85-95 born people. If you look, you'll realize that one of the biggest transformation, behavioural transformation that has happened all over the world and especially India, is that a country in which the normal way of dealing was that we will have somebody else do something for us, became DIY .
Smartphone, because it's a personal device, it actually changed people's behaviour to a DIY approach. And that approach in itself is a big disruption leading to 20,000 other things. We were ahead of our time. One: because of these infrastructure things. Second: we were ahead of our time because this was also the era when people were not buying software.
Our parent's generation, they only bought a computer. Computer vala installed the windows pirated, office pirated, everything pirated. It didn't even occur to them.
Paying for a software looked like a crime. You don't pay for service. In that era, we were trying to sell a cloud-based point of sale system, which requires internet, is not going to be installed in your system. It's going to remain online. And to make matters worse, this is also the era because previous generation is in power. Everybody is trying to under bill, and they are scared about anything that is online. Their CA is saying; don't take online software, your entire detail will go to government and people are horrified.
So we were ahead of our time in these aspects. Practically from an ecosystem perspective as well. And why it changed in 2016 is that we also were ahead of our time because this was also an era where online ordering is not happening. Online payment is not happening, products are not integrating with each other.
You are not always on the move. Your customer is actually sitting at his/her own restaurant the entire day. You can't replace that human with the software. We have had a funny incident where in RK Puram in Delhi, a very popular bakery: one of our sales guy back in 2012, one day made the sale, came out very happy.
And we were selling for 12,000 rupees per restaurant per year. Very, very cheap price. It was still costly for people because they were not used to pay for the software. And even if they were used to pay for the software, it was like a onetime 5,000 rupees and that's it. And we were saying that we're going to charge you 12,000 rupees every year.
You know how we used to sell, we used to convince people by saying, okay let us assume this is 12,000 rupees one time. You use it for this year. If you don't like it, you will not renew it anyway. So why are you frightened on 12,000 rupees next year?
So this guy came back and he said, "I've got this legendary iconic bakery. All is done". I said, "okay". two days from then we got a call from that guy and he was abusing and shouting and he was like, "guys, please come back. Refund my money. Take your product out". And this guy went and I told him you go there. Relax, calm him down. Let me talk to him, if I can convince him and understand what's the problem. So the story was that this guy's son and son was young, 21-year-old. He had just joined the business and first thing that he tried to do was to replace Papa with POS. And Papa was the one who figured this. By the way, he was not abusing us. He was abusing his son. He was like, my son is like a stupid fellow.
I request whatever damage I've done to you guys please take that money, but please refund me my money and take this off. I had a chat with him and I said, "uncle, is there a problem with this software?" He said, "no, there's no problem with this software, but I don't want your software". I said, "ok". He said," convince me. Why should I have your software?"
I said, "okay". Now this is that classic story. Have you heard that joke of Bill Gates once went to fisherman, and fisherman was sleeping. And Bill Gates said " Hey dude why are you sleeping?" He said, "I had the catch of the day." He said, "okay, but then why are you not catching more?" He said, "what will happen if I do that?"
He said, "you'll be able to sell more." He said, "then", he said, "you'll make more money". Then he said, "you'll have more fishing nets". He said, "then", and Bill Gates of course takes this thing to like large fisheries. And he said," then ".He said, "then you sell your fisheries company and sit back and relax". He said, "what do you think I'm doing right now?"
I really had that moment with this uncle wherein I said, "Uncle, software is going to allow you to automate your shift". He said, "then what will I do?" I said, "then you are free from your store and you can do other things". He said, "but I don't have any other thing to do". I said, "then you can open another store".
He said, " no, I'm done with this store only. I'm not going to open another store". I said, "but we're also going to make sure that there is no pilferage, and there is no stealing at your store". He said, "if anybody is going to try stealing anything, I'll cut their hands". I said, "okay". So I ran out positive.
I said, "okay, can you pass on the phone to my sales guy?" And I called him and I said," look, he is right. We can't replace him with the software, refund his money, come back". This is why we were too ahead of our time. There were no reasons for people to technically adopt us but these kinds of incidents also helped us triangulate our ideal customer profile.
So these kind of incidents, 2, 3, 4 times made us realize that our ideal customer is the new age restaurateur. A fresh restaurateur, a young restaurateur. Somebody who is not willing to sit at the restaurant full time. Somebody either has other businesses or has plans to open more stores. We basically qualified, by 2013 within that one year, we had a very solid qualification of who is our ideal customer. And I can tell you until 2015, or rather I would say 16, 80% of our business was new restaurant installation. It is only after 16 that an established restaurant using a legacy system, we replacing that it actually accelerated after 16 and cut to 2023.
Today, 95% of our business is replacement. In fact, today tables have turned in a way that a new age restaurant owner is actually quite a curse. We don't want to serve them because we are a very large product.
If I put you in a Mercedes on day one, while you will appreciate Mercedes, but you will technically not be able to appreciate it for what it is. I have to put you in a Maruti 800 for you to truly appreciate what Mercedes brings.
In our case, a new restaurateur appreciates us, but can also take a lot of goodness for granted. And we are a very customer centric company and that is something that you can validate by doing a Google search. If you'll Google search Posist reviews, you'll see thousands of reviews.
The number is so high that I can't even take it. And these are the reviews where you'll find people love our support. People love our assistance. People will talk about that, "oh, nobody has ever duped them". We are the company who refunds money if things don't go well.
So we have remained customer-centric at a short-term cost. And those short-term costs were really costly. But I think we invested all those things believing that there is going be another day and we going to live long and this guy is going to turn around and come back. So don't worry, relax. Today we have realized that people who have actually used something crap or who have a high stakes problem that is unsolved, have a pain, appreciate us more, and people who don't have pain or don't have a perception of pain right now, can appreciate us, but not exactly for what we really bring.
Akshay: A lot of SaaS companies start with SMB market first and then they move to midmarket and then enterprise.
Ashish: We had the same curve. Between 2012-2016 we were India focused. 2016, we switched gears, hard switch and we went enterprise India. And we started toying with SMB outside of India and for outside of India meant Singapore and Dubai.
Akshay: What kind of revenue did you have in 2016. Did you need external funding to go outside India?
Ashish: Revenue in 2016 was very less. 2016 March we closed it with 1 crore 10 lakh in revenue.
Akshay: How could you afford going abroad?
Ashish: We were still profitable. We operated company with profits from day one.
We were profitable in 2 lakh 40 thousand rupees a month. Our team was always lean and we maintained it by design. Both me and Sakshi temperament wise, we cannot sleep if it is burning. We invest a lot in the forward growth.
But not at the wrong unit economics. All those principles nowadays are being talked about a lot. I hear your question.
What I can tell you is that we started going outside, but we kept on increasing the price of our product. So important thing for you to understand is that a product that we sold for 12,000 rupees per year in 2012, we increased the price to 24,000 in 2014. We tried increasing the price in 2015 to 40,000, but that did not work.
Because value creation was not enough. It was our fault. And then when we switched, when we moved to enterprise, or rather a chain first approach, it was technically not even enterprise. We just said that it was chain first product and we rewrote our entire product from scratch.
We re-architected that. Our price from 12,000 and 24,000 straight went to 1.2 lakh and 2.4 lakh per restaurant per year. This was a hard, ideal customer profile change as well, where we stopped talking to small restaurants. And, our definition of small was, if the restaurateur here is thinking small. For example, if you are a quick service store, let's say you're a waffle store chain.
And you have five stores and you're sitting on and you don't think about 50, technically you're a small guy for me not because you don't have money or your lack of money because your ambition is so small that probably you will find me not only costly, you'll find me ridiculous. And I agree with you.
We've been pretty self-aware about it. So in 2016 when we switched these gears, the idea was not that we were selling 1.2 lakh product to the same people who we were selling 12,000. No! The game was in qualification. We basically hard qualified, we trained our sales team to walk away faster. Then the prospect can walk away from you.
I love those spam call that I receive. "Hello sir, credit card ly na hai," and before me she puts the call and I'm like this is perfect. She is absolutely mission oriented. And I don't appreciate calls when somebody is saying, "hello, sir, I'm from this, good morning, sir, do you want loan?" We basically trained our sales team to ask very, very hard questions to understand the stakes of that business.
I'll give you one definition: for somebody to buy a 1.2 lakh per year sort of product. We were very sure that we need to deliver at least a savings of 12 lakh to somebody. Then only you justify taking 10%. Don't think that this is a subscription cost. It's ROI.
Now, if you're pitching a 12 lakhs worth of savings, you're not Superman. You can't save 10% for someone. That business owner is not that stupid. That you are coming from outside and you'll click and save it. So let's be serious about it. Let's be real about it. Let's say that your product is going to bring in 3 to 5% efficiency in the business.
And you need to find those areas. That means for you to save 12 lakhs for someone in a year or 1 lakh rupees in a month. By this definition, that person should be making a profit of a margin of at least 20 lakhs in a month. For somebody to make a margin of 10 lakhs in a month, buy worst logic, they have to make a sale of 60 lakhs in a month. That was the golden number. If your restaurant is doing less than 50 lakh revenue a month, wrong answer 'out'. So our ICP changes. Now, when you go to a restobar who is doing a crore a month, "boom!", you are in the game.
Our conversion rate has been 85%, not on the cold call of course, I'm saying from a qualified one. Once we qualify a prospect, our conversion from qualification to convert was very high. So we basically effectuated that. Because you asked that question that, how could you remain profitable or how could you grow outside?
I have a very strong belief, and this is something that I am not only saying for my own business, this is my passion. I do this with other entrepreneurs. I do this with my portfolio companies, my friends, where I believe that if you are pricing right and if you are not wasting your marketing, your sales dollars in chasing or prospecting or convincing or working the wrong people.
You can be solid; you can be super profitable. Your CAT will always be very low. Your CAT will return a long-term value. If you are a qualified prospect and we have hard qualified prospect, even if you don't buy today, we don't feel bad because we know that we have left you with such solid information and understanding that you may not be buying today because of 20,000. You may not have budget; you may not have conviction. You may believe that your business is not ready for it. You may have an idea that, "oh, I want to try a cheaper one". I know that in the next three years you are going to come back. If you'll talk to an average Posist salesperson, they'll never tell you that there is a lost opportunity.
And I'm not just saying it for saying, because each of them have seen so many people coming back that the general operating belief of the company is that there is no lost prospect. It is only delayed. And that allows us to put our best in every conversation we do with the customers. But at the prospecting stage, at a qualification stage, we're brutal.
We'll ask you 20,000 questions and if you at any point saying why should I tell you that? Or if you say, "oh, my software is doing fine. I'm just curious of what do you have to offer?" The guy will very politely with hand folded, he'll say, "sir, let's not fix what is not broken. If you have a pain, we can try and figure out if we can solve. If you don't have a pain, why are you wasting your time? I can give you a demo, but it won't help you".
Akshay: What does your sales funnel look like. From top of the funnel till conversion, how do you do your lead gen and what all channels do you use?
Ashish: One thing is that 95% plus of our business is completely inbound, including enterprises. Our marketing channels are very educative and brand marketing and long-tail marketing channels. We do a lot of trade shows globally. In 2022 we visited 27 events globally.
And these are trade shows, exhibitions, conferences. So in conferences, we sponsor, I speak at conferences, in trade shows. We'll put large booth. We'll also do our own events. We'll do small round tables, we'll do our own mixers. Apart from that, we have a digital site, which is a content property that we run.
If you will search, The Restaurant Times, or if you will search any question, how to open a cloud kitchen, how to start a restobar there is a very high chance that you'll land up on Restaurant Times article. These are all primarily written content. We experienced 3 and half million unique visitors every year on the blog, completely organic.
Our blog and website generate 600+ qualified hot leads every month. We don't do paid advertising at all because, we don't understand it well or it didn't work for us.
Also because we don't do SMB now, so the reason to do paid advising also fell through the flags further. Our primary business today is upper mid-market, large enterprise. Our ticket size is $100,000 to 1 and half million dollars annual. We still do 10,000 to $100,000 deals.
But those are actually not the ones where we'll be working hard. It's actually mostly the worst. There can be a brand which has only two stores right now, but there are in for 200, and very progressive, solid company. So today that contract is going to look like a $10,000 or $5000. We continue doing that, but again we qualify this piece very, very clearly that why are buying us?
Because honestly, we do three-year contracts. If there is even a little chance that you're not going to renew next year with us because you were not able to take value out or you were not able to provide value or you found it costly, you would rather about it this time. You'll say let's come back once you're ready. This is not the right time. You'll also waste your money. We are also nice to customers that way because we are above that greed. For us, prosperity of any business can only be achieved when you have longevity and predictability with your customers, with your revenue, with your cash flow.
And that's the only way you can continue building your product. When a customer signs me up for three years and I have a visibility of three years. Now when a customer makes an ask, let's say, develop a feature for them, I know that this is going to be used for next three years. When I commit a mistake, customer knows that he is signing me up for three years.
They're not going to fire me instantly. So there is no negative stress in the system that, "oh, will he renew next month?"
Akshay: Constant pressure of controlling churn.
Ashish: When you take every kind of negative stress out of the system, then system operates in a positive stress.
I define negative and positive stress as when you are running to win versus when you're running to not lose and when you're running to not lose there is a lot of negative pressure built.
Akshay: And your sales international, domestic, all of it is happening from India?
Ashish: No. We have people on the ground in different countries. We have our teams right now present in Dubai, Saudi Arabia, Riyadh, Singapore, Bangkok, Mexico City and US.
Akshay: This would not be like inside sales. Because these are high ticket deals.
Ashish: These are high ticket deals; these are not inside sales. Most of the heavy lifting you'll see happens from India. Most of the background roles happens from India.
Akshay: My last topic that I want to talk to you is about your journey as an angel investor. What made you want to be an angel investor? How do you evaluate people who pitched to you? Tell me a bit about that.
Ashish: Why I became an angel investor; I'll go back to probably my early days. I always wanted to invest in other people's equity, even when angel investing was not popular.
In fact, I can tell you that it was so difficult to broach the subject that my first angel investment would've happened in 2011. And there was this guy who was also an entrepreneur in our kind of stage. And we were formulating Posist end of 11. And this guy was had started his company three months before and he was still early stages and the guy was absolutely on point, product was phenomenal.
We knew that it would go places. And I remember in December of 11 or Jan 12 this guy was trying to raise money in the Indian Angel Network, Mumbai Angels in India, and was getting harassed left, right, centre with those folks. People were asking him random things, giving him term sheets. And he used to come in the evening and rant about it.
Me and Sakshi looked at each other and said, "Hey, we should invest in this company". And it occurred to us very naturally. Angel investor in India in 2011 was somebody who must be sitting with like a 100-crore cash.
Akshay: Someone who is a US returned guy.
Ashish: We both said we should invest in this company. We couldn't muster the courage to ask. Because he was a fellow entrepreneur and we weren't sure how will he look at it.
And exactly one year from them then, we kept in touch, we kept on bouncing off ideas, helping each other and he made it to YC from India, very early YC batch. That company today does 80 million in ARR.
Akshay: Which company is this? Who is the founder?
Ashish: This company is called Plivo. Founder is Venky. Plivo is a Twilio competitor.
Akshay: You understood that business well.
Ashish: I understood telecom business very, very well. We never told him that. We of course told him very late. But we couldn't muster the courage. These are the seeds of engine investment where thankfully for me and Sakshi both, temperament is very similar about these things. Our risk appetite is very similar. I think that's great.
Otherwise it would've been a little bit of a problem. Our belief in entrepreneurs is, it's too much We genuinely believe in entrepreneurs. We believe in creators. We don't mind losing money at their hands because we are also pro learning. And I'm not saying this in a virtuous sort of way.
I'm saying this in a very practical way because I have made 48 investments so far. And I can tell you that apart from cash return, the amount of knowledge, amount of learning, number of journeys that I have gone through with all these friends, all these entrepreneurs, the number of journeys that I keep going through with them, the magnitude of depth and the breadth of experience I gain from these 45, 48 and more is worth more than I have invested, or they can return.
I can speak to you about anything under the sun. And so much of that knowledge comes from fellow entrepreneurs. For example, today in this podcast you learned a little more about restaurant backend. A little more about why a banquet will use the software.
Now imagine if you were talking to me 12 times a year and I'm discussing with you my deep dark problems, your perspective about my business will be as much: you'd be looking at a restaurant and you'd be feeling selling a software to them.
For us, that journey was important. When we were saying that, "oh, let's invest in Plivo". I think me and Sakshi were not really thinking that, "oh, he will go do YC and make a lot of money". It was just a romanticism, like the basic romanticism, fundamental stuff.
We love talking to him. He loves talking to us. This is high energy. This is awesome. Let's be part of it. Let's buy a small ticket. That happened, we did not really think a lot about it, but when he went to YC and started flying, it got validated. But our first Angel investment really happened in 2016, when another company: a friend, who we were helping in general, bouncing ideas and all he needed 10 lakh rupees. And he was in a little bit of a deep set.
And I loaned that money and I of course believed in him. And the project for which he was asking 10 lakh was also YC. And I actually told him, and he was worried that what if he doesn't make it to YC. So I told him, I said, "don't worry, this 10 lakh is not your burden. It is also not philanthropy".
Take this 10 lakh, go to Techstars. If you go through, great. If you don't keep this money, whenever you raise your next round, whatever that valuation is, convert this into equity and I'm fine then. So these guys could not clear YC. They, I think they did textile. I don't remember now. But that company, went on to do good stuff, eventually got acquired, and that kind of became the start, of that journey.
Since then it has only raised over time, but one of the major reasons in 2016 for this to happen was actually a personal side event. We got a massive acquisition offer and money was good for our stage. At that time, money was also good at an individual level.
Akshay: What are some of those iconic brands that use Posist in India?
Ashish: In India, right from your Sanjeev Kapoor restaurants, Yellow Chili, Yellow Merchi to Dabur has this, chain of restaurants called Punjab Grill, Zambar they're all over.
Places at all iconic locations like Copper Chimney, Bombay Brasserie, Irish House, all these users. Then QSRs like Belgian waffles, Wow Momos, lot of homegrown chains in every city. Then in international brands, you'll find us in Carl's Jr, Taco Bell, Subway.
You'll also find us in top fine dining restaurants. You'll find us in large restobars. I can name them for each city. Each city has its own ecosystem. Sambal is a popular brand name in Goa, in Hyderabad they're a customer.
A lot of iconic small locations. North Delhi has Murthal. On Murthal, AHUJA NO 1 which is like a 60–70-year-old dhaba. North India has these beautiful Havelis on highway. Haveli is a customer. And I can keep on thinking like in Bangalore you have you have Magnolia Bakery from New York, you have Arbor Brewing Company. You will find us at all these locations.
Akshay: Amazing.
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Until the next founder's thesis📕,
Your host, AD