Genesis of Cybage
Arun talks about his experiences in his formative years in Founding and in shaping Cybage. He talks about the first few 1)Breaths 2)Steps 3)Tiny wonderful things that took Cybage to what it is today. Arun cautions that his sales stories at Cybage is not a sensational visionary fable coming from a far sighted founding CEO but is fraught with lots of mistakes, failures and how he made success out of those learnings. Arun did his engineering in India and went to Virginia Tech, US in 1987 to do his Masters. He had no intention of going back to India as it was not an happening place. His three step strategy was to “Finish MS, Find a decent job, Live happily ever after that”. He finished his MS and worked in Chicago for close to five years with a small manufacturing company. The third part of his strategy “Happily Live Ever After” did not happen. Living in Chicago suburbs did not excite him and he wanted to go home to India and he decided a new Three Stage Strategy with minor modifications – “Get married, Find a decent job, Lead a happy life”. Like every other leader who succeeded, the restlessness that arose of the uninspiring and lacklustre presence was the seed of his success.
Arun came back to India in 1994, got married and became a stock market analyst in Ahmedabad. The stock market collapsed taking away all his savings. He had two choices – Hasty retreat to the US or one more shot at settling down in India. Arun, instead of hanging on till the stock market came back to normal levels for him to continue being an entrepreneur, he chose pragmatism over perseverance. He choose the latter and went into a job in Pune that had Flexi timings, Complimentary Lunches, Five day work week, Awesome boss and also a pool table. Arun, as an Test Engineer watched the company grow and he also became a manager within 6 months. Then came the big bang – the launch of World Wide Web which gave a futuristic promise tha it will change the way global business is transacted. Arun decided that this was the time he announced his arrival in the entrepreneurial world. He jumped along with the other booty hunters in the great gold rush of mid-nineties.
The Product Idea
In 1995, the towering role model was Netscape – the golden boy of the browsing world. Many websites were mushrooming in the world more than the readers can read. People were getting lost in the Internet, they did not know what to read. They were stuck with the gray arrays of the buttons presented by Netscape. Arun sensed an opportunity decided to take a big step – Build a browser for dummies and sell it to a multinational for USD 1 Million and accomplish his “Live Happily for Ever” motto.
He realized that he would not be able to reach out to the wide US market. He needed a business partner with a great marketing presence to achieve commercial closures. He had his dads friend who was running a Hardware and a Body shopping enterprise out of Connecticut and it seemed like a perfect fit. A US company with deep pockets that was looking for a tie up with an Indian startup. They accepted the partnership even though not in paper as Arun did not want to make his uncle sign loads of paper. Arun says that he got entangled in heavily tilting towards the operation side of the execution and marketing side of the business but did not focus on selling the product.
His first team
Excited with the partnership in the US even before he began, Arun picked up a 3 BHK flat for rent in Pune. He hired his first four employees and called his business partner in the US to give him the good news. He had a shock of his life. His uncle said that he is no longer interested. When asked why, his uncle said that Microsoft is coming up with a browser and hence the market will be more competitive. When Arun suggested that they can do some other product with the partnership, the reply was a strict no. Arun recalls that moment, he was stuck with the initial investment of the flat and employees, his only business partner walking away on the same day the company was launched. He asked himself if his second entrepreneurial venture is failing:. After some thought, he decided that it was too early in the game to pull down the shutter and decided to fight it alone.
The first product
After the honeymoon period, it was down to business. The team had to develop a 32 bit browser on a beta version of Windows 95. Internet connectivity in India was pathetic. All they got was a 2.4 MBPS dial up line which used to get disconnected every 2 minutes. However, the intention to kill Netscape was there with the entire team and they fought all of these and were building the product. Arun talks about his arrogance that even though he knew that Netscape had Marc Andreessen (Founder of Mosaic – the first browser in the world) leading an array of bright engineers, Arun thought that he can fight them with a 4 mediocre team of engineers led by him. Still they did one version of a browser in around 6 months and called it CyberAge Raider and was ready to take on the world. Arun handed over the reigns of the operation of Cybage to his wife and went to the US himself. He spent quite a bit of money by participating at multiple tradeshows & conferences and unveiled CyberAge Raider expensively. The product got lots of reviews including the coveted “Product of the Month”
The big hit
Microsoft arrived with their Internet Explorer. It was Bloodshed all over. Microsoft found a nice way to compete – FREE.. That changed the face of the internet. Arun was perplexed. How does he compete with a product from a company like Microsoft when it is given free. He figured out that no one is going to make money by selling internet tools. He re-strategized and isolated some 3D components of the browser and made them Netscape and IE plugins and all he got was one free link from both these sites. Business don’t run free, they need money. CyberAge cannot be acquired now. He needed some big VC funds to launch his products, but VCs business model is not to help people who needed money the most. At this point, his brother Deepak stepped in with the Financial Investments and became Cyberage’s investment partner.
First Customer Acquisition
With new hope and some stamina left in him, Arun worked much harder. He again changed his plan and began pitching offshore business capitalizing on CyberAge Raider as a branding tool using the product as a testimonial of the high quality work. He got a meeting from a large enterprise (Faralion – now acquired by Motorola). He got the magic words through an email – Meet us when you are in the Bay Area next time. He took a flight for this purpose only. He pitched to the companys CEO and the two Sr VPs, they were impressed and told him they will get back soon. Arun returned home and spent his next two days sitting next to the phone. It finally rang – Steve Soloman – one of the two VPs said that he would like for Arun to visit Kansas city. Arun was horrified – Another flight and expense. However, the client had arranged everything like Flights, Car Rental, out of pocket expenses. Arun was thrilled. Here he found a prospect fishing out for the right vendor and vounterring to sponsor the marketing trip of a potential supplier. The team got convinced and wanted a four member team to begin with. They began negotiating the monthly rates per person – Arun said – $ 1500, Steve says – $1200, Arun said – $1400 – there was silence for a few seconds and Steve nodded. Cybage got the first dose of Oxygen and began breathing.
Arun’s Advice to early stage entrepreneurs
Nothing succeeds like success. He was staring at so many failures in his entrepreneurial ventures 1)Stock market collapsing making him go back to a job 2) His uncle who was supposed to be a 50-50 partner walked out on day 1 and Arun had to fund his business 3) His browser product collapsed. In hindsight, he made so many mistakes and there were so many things he could have done better. But Arun says that instead of getting dejected, he converted these into opportunities by 1) Getting into an IT job to understand the power of the industry 2) He has started his company only because he had the psychological confidence of the partnership and now he has full control of the company 3) He used the product development experience to pitch offshore services to his customers. He calls these blunders as blessings. Arun says that Life is a sequence of events. He is a big anchor of probabilistic theories. He believes that things happens as long as one does their jobs and these are the best learnings to a person if it does not work in their favour. His failures have made him stronger not because they were meant to make him stronger but because he was able to positively convert his failures to positions of strength. He believes in a data driven approach where he was able to increase the probability of his success by designing his life in a success way.
Cybage employs more than 5000 people, 8 global offices and has around 200 customers. Cybage has won the best Employer Brand Awards in Asia, been conferred for the Asaian Outsourcing Excellence Award by CMA Asia Awards 2013 to name a couple. Cybage has also received ratings from IAOP, Gartner, Zinnov, DataQuest, Bloomberg. They are still bootstrapped.