Use your Personal Credibility to win the First Customer
Srinivas Rao Mahankali Co-Founded Aujas Network along with Navin Kotian and Sameer Shelke. After his MBA from IIM-B, Srinivas had worked for 12 years with Sonata, Computer Vision Labs and MicroLand where these companies were small entities at that point in time and he was fortunate to work with the founders directly. With that experience, he realized that starting a business is tough but succeeding in business is not impossible as he had seen the three founders (his immediate bosses) building the business and scaling them. Rao joined Network Solutions(Netsol) as which was founded by Sudhir Sarma and Jayant Deshpande to help strengthen management depth when it was an early stage organization which had built some traction. Rao was responsible for Business Development and Operations at Netsol. Under Sudhir’s leadership, Netsol went from strength to strength and IBM acquired Netsol in 2005. Rao was with IBM-Netsol for about 18 months and then was with Cisco India for about six months responsible for Strategy and Operations . The entrepreneurial bug bit him again.
Rao met Manjula Sridhar, Entrepreneur in Residence at IDG Ventures through LinkedIn. Manjula was working at IDG to help identify entities in the IT Risk Management / Security space in which IDG could potentially invest. Manjula set up a meeting with Sudhir Sethi, Chairman and Managing Director at IDG Ventures. Sudhir had a thesis that cybersecurity solutions would be increasingly important and there was an opportunity to create a significant global entity and a dominant Indian player. After several discussions Sudhir asked Rao to put together a team and a plan to build a company with the proviso if the team and the plan were good, it would be funded. Rao worked on putting together a team reaching out to over 70 people . Sameer Shelke who became the CTO of Aujas and Navin Kotian who became the COO of Aujas decided to join hands with Rao.
Over the next three months in the course of putting together the plan, the trio spoke with a number of people they had known in the past, the response was 100% positive which gave them a lot of validation that there was a product market fit. Srinivas recollects the mistakes he had made like expanding over aggressively into multiple geographies ahead of time because they were VC funded. They got excited when they got two reasonable size engagements in Switzerland and they thought that they arrived, but it was beginners luck and since they did not invest in sustainable efforts, the subsequent deals became difficult and they were burning money without any revenue and they had to withdraw from over ambitious expansions after sometime. This according to Srinivas is one key lesson for any startup that when the expansion happens out of India, one of the founders must be actively involved in the setting up and scaling the operations outside India and not leaving it to some new hire who joins. This is still practiced where they depute people for new initiatives who have worked with them for a while and who have understood them.
The first few customers were those who he had known for 20 years. The personal credibility stood in their favour in-spite of this category and the product being new to the market. The known people gave them small engagements and they happily took it up and they are happy that those clients still stay with them even after seven years. He recollects that he had the standard objections like lack of experience with other customers, survivability and service levels but they began closing the deals because of the backing of IDG ventures and personal credibility. The first customer was an insurance company, a joint venture. They knew the CIO from the past as they had done some work in early 2000. They presented a slide deck on what the product is all about and the benefits that the product will offer and they asked for a pilot to be conducted with the SLA that it will turn out to be a small engagement if the pilot will be good. Srinivas nostalgically recollects that they closed their first deal of INR 81000 in 51 days of inception on May 21. He continued this known circuit methodology and went after his second customer which was an IT Services company. They met the CIO again and went through the same process, did the pilot and closed the deal.
In addition to using personal references which is finite and will end someday, they consciously went and spoke at events like IDC and evangelize cyber security and the importance and created larger than life presence by meeting all these CIOs and CTOs in these events They also tried different things to create awareness and be on top of the customers mind. They also created security related games instead of being on panels which people learnt about cyber security and enjoyed this instead of perceiving this as a lecture. This generated a good amount of mindshare and brand recall. They also diligently kept asking for references from each conversation which led them to lot of prospective customers. They then began to engage with partners . They also came up with a monthly newsletter talking about security trends and when they bumped into people at multiple places they were pleasantly surprised the prospects remembered the newsletters
Srinivas’s advice to startup founders – Have a clear story on what is it that you want to do. One tendency people do during their struggle period is try to be everything for everybody, but that does more harm than good. It is also good to have a complimentary skilled founding teams. Relationships will get only meetings but will not close deals. Hence the choice of picking up the right set of prospects to spend time with in the early days is extremely important. All prospects may not have a real need and the budgets at that point in time inspite of them showing lots of interest and hence persistence is very important.
Aujas Networks (http://aujas.com/), is around 250 people and have a global customer base of around 200 customers. They also raised a Series B from two other investors. They were in the Nasscom Emerge 50 for four years and also in Delloitte fast 50 for five years. They have won accolades from IBM , RSA . DSCI awarded their security platform as the most innovative product of the year